The Continued Financial Burden of Home Care

By | July 2, 2019
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We can’t discuss the challenges in healthcare without considering the aging population who will be moving to home care settings more and more in the coming years. Shifting the focus to home care and the value it brings, it is necessary to remember that the patient and their families absorb a portion of these costs. And the financial burden of home care occurs in various ways. To understand this burden, it is important to remember that care delivered by family members is uncompensated and usually requires the family member to either miss work or substitute time and attention to their family member.  In fact, the National Alliance for Caregiving estimates that 34.2 million Americans have served as unpaid caregivers in the past twelve months at a value of $522 billion of hard costs, and this doesn’t even include forgone income for the care taker.  In a recent article in Health Affairs, Work-Related Opportunity Costs of Providing Unpaid Family Care…  the author noted this forgone income is estimated to be $67 billion.

Another recent study by Johnson et al., The Financial Burden of Paid Home Care On Older Adults: Oldest and Sickest Are Least Likely to Have Enough Income, discusses the financial burden of direct costs to older adults. In terms of the economic hardship, the study found that 74 percent could fund at least two years of a moderate amount of home care if they liquidated all their assets, and only 58 percent could support at least two years of extensive home care. However, if an older adult had significant disabilities, those percentages decreased to 57 percent and 40 percent, respectively. Additionally, this study is also assuming no increases in the cost of home care services despite the known labor shortage in this field and the cost of healthcare continuing to rise. Considering all of these studies and the economic evidence they have found, what is fascinating is they framed the conversation in the context of liquidating all assets, which means to pay for their care, the patient is essentially going broke.

This is not a good solution and will just lead to a higher cost in care. Furthermore, since so many will not have the ability to pay, caretakers will look more to place family members in the care of a facility and not because they assume the care will be better, but, instead, because one instinctively knows they and their family member can’t afford the alternative. Consequently, this creates a situation that is not ideal considering not only is one unable to provide what is needed, but, the loved may not receive their wishes which is to remain at home and receive care. We all can attest as providers the more satisfied the family member is with their care, the healthier they will be.

Understanding this financial burden on the patient and their family continues to be an important cause for discussion. Especially as our Baby Boomers age out of private insurance and into Medicare.

Thus, for our models to be sustainable and deliver what is optimal for all, we need to increase the focus on shifting the payment models to cover care that is affordable, relevant and appropriate and can be provided at the right place, at the right time, and in a manner that is desired by those we serve.