Costly caregiving: A case for policy solutions
Family caregivers know that long-term care can be expensive, and recent research has confirmed this. Expenses may include prescriptions, co-pays, medical equipment like walkers, and home modifications. There are also a number of indirect costs if caregivers reduce their employment or stop working. Besides lost income, stopping work can mean losing access to retirement programs (and matches from an employer), losing health care coverage, and no longer contributing to Social Security. In fact, a June report by the National Alliance for Caregiving found that the average caregiver aged 50 or older who stops work to be a caregiver full-time will forego $303,880 worth of wages, Social Security, and pensions benefits.
By passing sound policies, we can ease the financial burden on family caregivers and alleviate some of their stress.
Paid Family Leave
California’s Paid Family Leave Program is one strategy to address the challenges of balancing caregiving with employment. Employees who pay into the State Disability Fund can take up to six weeks of partial pay (each year) to care for a seriously ill parent, child, spouse, or registered domestic partner. Leave for bonding with a newborn, adopted, or foster child is also covered. While on leave, a worker receives 55% of their weekly wages (capped at $987). New Jersey is the only other state that has a Paid Family Leave program, though Washington State may implement its program in 2012. In some cases, paid leave can allow people to care for a loved one without giving up their job. California’s program has been well-received by the business community, and should be a model for converting the national Family Medical Leave Act into a paid leave program.
The CLASS program, included in the Affordable Care Act, is another promising solution. As the nation’s first voluntary social insurance program, CLASS would alleviate some of the costs of long-term care. People will pay a monthly premium, and once vested, if they became disabled, the program would pay a daily benefit of at least $50 to help pay for their care. The recipient can use the benefit to hire friends or family to provide care, purchase adaptive equipment, or to hire outside assistance. The benefits probably won’t be enough to pay for all of a person’s long-term care needs, especially for people who need around-the-clock care. However, it will give care recipients control over how to use their benefits and will help with the costs of long-term care. One of the recent budget deficit proposals called for eliminating CLASS, but the approved plan did not include CLASS. Congress committed itself to cutting $1.3 trillion in domestic spending as part of the deficit deal, so it’s quite possible CLASS will re-emerge as a program to be eliminated.
With 10,000 baby boomers turning 65 every day for the next 19 years, Paid Family Leave and the CLASS program represent positive, concrete steps to address our nation’s looming long-term care crisis. Congress and President Obama should remember the needs of the nation’s 42 million family caregivers and their loved ones as they make decisions about our nation’s budget.
Sean Coffey is a Policy Specialist at the National Center on Caregiving at Family Caregiver Alliance, where he writes the Caregiving PolicyDigest and also helps staff a national information and referral program for family caregivers.