Financial Decisions and End-of-Life Care

Posted on June 4, 2018

Sadly, there will come a time where you are faced with making difficult decisions about end of life care for yourself or a family member. Whether it is sudden and unexpected or a slow winding road, the period is often fraught with many decisions regarding the needs and comfort of your loved one and unfortunately, very real costs. Medical costs over the last year of life can average approximately $59,100, according to the National Bureau of Economic Research. The costs that come attached to life-extending medical care, necessary adjustments to the home or making the important decision on palliative care all add up. Yet, Americans continued to be remiss about the topic with 2 of 3 Americans being ill prepared. Similar to planning for your retirement, it is important to plan for this financially should you ever need it. Here are a few ideas regarding financing end of life care costs for yourself or loved ones, both ahead of time and unexpectedly.

Explore & Plan Your Policies
One of the best things you can do when planning for retirement and the later years is to consider health and life insurance policies. End of life care costs in America averaged around $18,500 for hospital patients in 2016. If additional support or surgery is needed, that number can rapidly increase. Another point to note is that more Americans are choosing to spend their time left at home which may require home care. Insurance policies can help to offset these health costs while some life insurance policies also provide payments in the events of terminal illnesses.

There are dozens of companies and choices, all providing insurance options regardless of your age or status in life at the time of securing your policy. Depending on your age and policy you choose, you can secure a package with monthly payment within your budget. For a $100,000 combined policy secured at age 30, you would be looking at an average payment of $24 per month. However, take the time to explore all your options and get the best package tailored to your needs. Critical or Terminal Illness Benefit is often included in many packages at no extra cost and enables an early payout if the medical situation arises.

Federal Health Benefit
If you are looking for a more affordable option, you may be able to purchase health insurance (including critical illness cover) through the federal marketplace offering a choice of plans. The Medicaid expansion and 2006 Health Care Reform has led the way in improving the access Americans have to affordable healthcare coverage. To enroll and get more information, head to the HealthGov website or your state’s individual marketplace. For Massachusetts, this would be Massachusetts Health Connector Marketplace. Approval of coverage is improved as well since refusal cannot be made based on pre-existing conditions or gender.

Credit Options for Carers
Finally, if you find yourself in a sudden and unexpected situation of having to make these end of life decisions and financing them, then it may be time to explore your financing options. Many families proceed to take care of parents and loved ones in their older years. In fact, about 34.2 million Americans provide unpaid care to an adult aged 50 or older. However, in the majority of cases, medical costs can outstrip savings. Even with insurance, 1 in 5 families struggle to pay medical bills, with 44 percent of Americans having to turn to credit cards or a loan to pay a $400 medical charge. For families looking for emergency financing with ease of access, these options are generally preferred.

Non-profit organizations across America dealing with various illnesses or large hospital websites are also great sources of information regarding financial aid available in your state. In Massachusetts, palliative care can be financed through Medicaid, health organizations and private insurance plans.

End of life issues are never an easy experience for someone or their loved ones. This may be precisely the reason why we tend to avoid discussing mortality and the decisions that come with it. However, it is important to recognize the need and plan for those last days. By making preparations, you can help your loved one spend their final days with as much joy, dignity and quality of life possible. These financial options are just a few tools to help you get there.

By freelance writer, Jane Zachery