Around the world, wealthy countries are struggling to afford long-term care for rapidly aging populations. Most spend more than the United States through government funding or insurance that individuals are legally required to obtain. Some protect individuals from exhausting all their income or wealth paying for long-term care. But as in the United States, middle-class and affluent individuals in many countries can bear a substantial portion of the costs. Here’s how five other countries pay for long-term care.
Japan
Long-term care insurance is mandatory for Japanese citizens age 40 and over, while in the United States only a small portion of people voluntarily obtain coverage. Half the funding for Japan’s program comes from tax revenues and half from premiums. Older adults contribute 10% to 30% of the cost of services, depending on their income, and insurance picks up the rest. There is a maximum amount people must spend from their income before the insurance covers the remainder of the cost. Workers can also take up to 93 days of paid leave to help relatives with long-term care needs. Japan assigns a care manager to each person using services; each manager oversees about 40 older adults. In 2020, Japan spent 2% of its gross domestic product on long-term care, 67% more than the United States spent that year.
The Netherlands
The Dutch have included long-term care in their universal health care system since 1968. One public insurance program pays for nursing homes and other institutional settings, and another pays for nursing and personal care at home. Enrollment is mandatory. Dutch taxpayers contribute nearly 10% of their income toward insurance premiums, up to a set amount. Out-of-pocket payments amount to about 7% of the cost of institutional care. General taxes pay for a third program in which municipalities provide financial assistance and social support for older people living at home. There is no private long-term care insurance. The Netherlands spent 4.1% of its gross domestic product on long-term care in 2021, more than any other country tracked by the Organization for Economic Cooperation and Development, and four times the amount the United States spent.
Canada
Provinces and territories fund long-term care services through general tax revenue. Money budgeted is not always enough to cover all services, and some localities give priority to those with the greatest needs. The amount of subsidies people can receive, the costs they have to pay out-of-pocket, and the availability of services vary by province and territory, as they do in the United States with state Medicaid programs. The mix of providers also varies regionally: For instance, nursing home care in Quebec is mostly run by a public system while homes in Ontario are mostly for-profit. Notably, Canada’s long-term care system is separate from its national health care system, which pays for hospitals and doctors with no out-of-pocket costs to patients. In 2021, Canada spent 1.8% of its GDP on long-term care, 80% more than the United States spent.
United Kingdom
Local authorities pay for most long-term care through taxes and central government grants. Private providers usually supply services. Government contributions are based on financial need, with copayments usually required. As in the United States, middle-class and wealthy people pay most or all of the costs themselves. Unlike in the United States, the government provides payments directly to lower-income people so they can hire workers to care for them in their homes. The U.K. has also taken steps to shield people from losing all their wealth to pay for long-term care. It subsidizes care for people with savings and property of less than about $30,000, while in the United States most people don’t qualify for Medicaid until they have run through all but $2,000 to $3,000 of their assets. In 2022, the British government proposed extending subsidies to people who have as much as $105,000 of wealth and property, with a lifetime cap of about $100,000 on how much anyone spends on long-term medical care, excluding room and board in a nursing home. But the plan has been postponed until 2025. In 2021, the United Kingdom spent 1.8% of its GDP on long-term care, 80% more than the United States did.
Singapore
Singapore recently instituted a system of mandatory long-term care insurance for those born in 1980 or later. Citizens and permanent residents are automatically enrolled in an insurance plan called CareShield Life starting at age 30. They must pay premiums until they retire or turn 67 (whichever comes later) or are approved to use services. The government subsidizes 20% to 30% of premiums for those who earn around $2,000 a month or less. Monthly payouts start at about $440. Government subsidies for nursing homes and other institutional care can range from 10% to 75%, depending on ability to pay. Those who make more than $2,000 a month receive no subsidies. CareShield is optional for Singaporeans born in 1979 or earlier; they are covered under an older, voluntary plan. Singapore also provides a means-tested monthly cash grant — this year about $290 — to help with caregiving expenses.
Sources: The National Bureau of Economic Research project on international comparisons of long-term care; Kathleen McGarry; The Commonwealth Fund; Organization for Economic Cooperation and Development; government websites.Note: Spending comparisons with the United States are based on the most recent OECD data and include spending from government and compulsory insurance programs as a percent of each country’s gross domestic product, which is the total monetary value of all the finished goods and services produced within a country’s borders. The comparisons cover people of all ages and exclude spending from voluntary insurance plans and out-of-pocket costs. All currency figures are in U.S. dollars.
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Providing care for a loved one is a profound commitment, and in Pennsylvania, various programs exist to support family caregivers in this vital role. While Personal Care Assistance (PCA) broadly refers to services that help individuals with daily living activities, its important to understand that paid family caregiving in Pennsylvania primarily operates through specific Medicaid waivers. These initiatives aim to support the invaluable work of caregivers while allowing loved ones to remain in the comfort and familiarity of their own homes or the homes of family members.Understanding Personal Care Assistance (PCA) in PennsylvaniaIn Pennsylvania, Personal Care Assistance (PCA) refers to the services that help individuals with daily living activities and household tasks, enabling them to live independently. Its crucial to differentiate this from Personal Care Homes (PCH), which are residential facilities that provide housing, meals, supervision, and assistance, but typically do not offer third-party reimbursement for family caregivers providing care within them.Instead, paid family caregiving for PCA services in Pennsylvania primarily operates through various Medicaid waivers, also known as Home and Community-Based Services (HCBS) waivers. These waivers are designed to provide direct assistance with Activities of Daily Living (ADLs) and household services for older adults or individuals with disabilities who live in their own homes or the homes of loved ones. The services provided under these waivers are what constitute Personal Care Assistance in the context of paid family caregiving.Key Pennsylvania Medicaid Waivers for PCAPennsylvania offers several Medicaid waivers that facilitate paid family caregiving for Personal Care Assistance, each with specific eligibility criteria and rules regarding family members.1. Community HealthChoices (CHC) Waiver: Getting Paid to Care for Loved OnesThe Community HealthChoices (CHC) waiver is Pennsylvanias most common Medicaid managed care program that facilitates paid family caregiving for PCA. It is designed for individuals aged 21 or older who are eligible for both Medicaid and Medicare and require a nursing facility level of care. This program consolidates several former waivers into a single, comprehensive system and is administered by private healthcare insurance companies contracted by the state.Recipient Eligibility for CHC: To qualify for the CHC program, the individual needing care must meet several criteria: Age: The recipient must be 21 years of age or older. Dual Eligibility: They must be eligible for both Medicaid and Medicare. Functional Eligibility: A physician must certify that the individual has a condition requiring long-term services and supports, specifically an inability to perform essential Activities of Daily Living (ADLs) such as bathing, toileting, or transferring. A trained assessor will also conduct a functional eligibility determination to confirm the level of care needed. Financial Eligibility: The individual must meet specific income and/or asset requirements, determined by the local County Assistance Office (CAO). For example, in 2023, the income limit to qualify for the Pennsylvania Medicaid waiver program under CHC was $2,742 per month. Caregiver Eligibility (Who Can Be Paid, Spousal/Guardian Restrictions): Pennsylvanias Medicaid waivers generally permit family members, such as adult children, siblings, and even friends, to be compensated for providing care. However, under the CHC waiver, spouses (husband or wife) are typically not eligible to be paid caregivers. Similarly, individuals holding Power of Attorney (POA) for the care recipient or legally responsible guardians (such as parents caring for children under 18) are also generally excluded from paid caregiver roles under this program.Application Process: The process involves contacting the Pennsylvania Independent Enrollment Broker (IEB) at 1-877-550-4227, applying on the COMPASS website, and submitting necessary documentation, including physician certification and financial information. Once approved, the care recipient can select a state-licensed home care agency that employs family members, such as Avondale Care Group.Services Covered & How Agencies Facilitate Payments: The CHC waiver covers a range of personal care and home care services. This includes direct assistance with Activities of Daily Living (ADLs) like bathing, dressing, meal preparation, and medication management, as well as various household services. Family caregivers are hired as regular employees of the licensed home care agency, which handles all administrative tasks, including payroll and compliance.Payment Rates & Benefits for Family Caregivers: The compensation for family caregivers through Medicaid waiver programs in Pennsylvania typically ranges between $10 and $15 per hour. The number of hours approved depends on the care recipients health and needs, with a maximum of 35 hours of care per week often allowed. The maximum weekly pay rate for Pennsylvania is up to $700 per week, which aligns with or exceeds these hourly rates, potentially including overtime or other factors. Many agencies also offer additional benefits that significantly enhance the overall compensation package for family caregivers. These can include overtime pay, weekly pay, free Certified Nurse Aide (CNA) training for eligible caregivers, holiday pay (often 1.5 times the regular rate for specified holidays), 401k plans with company matching, company-sponsored healthcare insurance (with substantial premium coverage), flexible schedules, and paid time off.2. OBRA WaiverThe OBRA Waiver is designed to support individuals aged 18-59 who have a severe developmental physical disability and require an Intermediate Care Facility/Other Related Conditions (ICF/ORC) level of care. This program helps these individuals live as independently as possible within their communities by providing assistance with activities of daily living (PCA services).Family Member/Spouse Eligibility: Similar to the CHC waiver, the OBRA waiver excludes spouses or legal guardians from being paid caregivers.Payment Rates: Compensation for caregivers under the OBRA waiver varies by geographic area, typically ranging from $13 to $15 per hour. The maximum weekly pay rate for Pennsylvania is up to $700 per week.Application: The application process also begins by contacting the Independent Enrollment Broker (IEB) at 1-877-550-4227. 3. Consolidated WaiverThe Consolidated Waiver provides support and services to a broader population, including individuals of all ages with an intellectual disability (ID) or autism, as well as children under 22 with a developmental disability due to a medically complex condition. Recipients must be recommended for an intermediate care facility (ICF) level of care based on a medical evaluation.Family Member/Spouse Eligibility: A significant difference with the Consolidated Waiver is that it explicitly allows a friend or family member, including a spouse or legal guardian, to receive payment for care provided.Payment Rates: The average pay for Pennsylvania caregivers under the Consolidated Waiver typically falls between $11 and $14.50 per hour. The maximum weekly pay rate for Pennsylvania is up to $700 per week.Application: To apply for the Consolidated Waiver, individuals should contact the Office of Developmental Programs (ODP) customer line at 1-888-565-9435. Important Considerations: Medicaid Estate Recovery Program (MERP)While Pennsylvanias Medicaid programs offer crucial financial relief for family caregivers, it is essential for families to understand the long-term financial implications. The Medicaid Estate Recovery Program (MERP) is a federal requirement for all state Medicaid programs to seek repayment for long-term care costs after a recipient passes away. This recovery typically applies to individuals aged 55 and older who received Medicaid long-term care services, including those provided through Home and Community-Based Services (HCBS) waivers. Assets subject to recovery can include the deceased recipients primary home, even if it was exempt during their lifetime while receiving benefits. The states claim is generally delayed if there is a surviving spouse, a child under 21, or a child of any age who is blind or permanently disabled. Families may also be able to apply for undue hardship waivers in certain circumstances. Given these potential impacts on family inheritance and assets, it is highly advisable for families to consult with an elder law attorney or financial advisor for personalized guidance on MERP and comprehensive estate planning.
Pennsylvania offers Medicaid waiver programs under the Community HealthChoices (CHC) umbrella and the Pennsylvania Department of Aging (PDA) Waiver (often referred to as the PA Council on Aging Waiver). These programs help older adults and individuals with physical disabilities remain in their homes or community settings instead of entering nursing facilities. CHC and the PDA Waiver provide long-term services and supports (LTSS) based on assessed functional needs, emphasizing assistance with ADLs and IADLs. Covered services may include personal care assistance, adult day services, home-delivered meals, transportation, home modifications, assistive technology, and respite care for family caregivers. In addition, Pennsylvanias CHC Waiver offers Participant-Directed Services that allow participants to hire and manage their own caregivers, including family members. To qualify, applicants must be Medicaid-eligible, at least 60 years old (for PDA Waiver) or 21+ (for CHC), and require a nursing facility level of care as determined through a standardized functional assessment of ADLs/IADLs. In this article, we explain what Activities of Daily Living (ADLs) and Instrumental Activities of Daily Living (IADLs) are and how needing help with these tasks is central to qualifying for Pennsylvanias Medicaid waivers like CHC and the PDA Waiver.What Are ADLs (Activities of Daily Living)?Activities of Daily Living (ADLs) are fundamental self-care tasks that a person must perform daily to maintain independence. Difficulty with ADLs often signals a need for supportive services. Core ADLs include: Mobility (Ambulating/Transferring): Safely walking, getting up from a chair, or transferring from a bed to a wheelchair. Dressing: Selecting and putting on appropriate clothing (including handling fasteners) without assistance. Eating: Feeding oneselfusing utensils to get food from a plate to the mouth and consuming it. Personal Hygiene: Bathing or showering and performing grooming activities like shaving, brushing teeth, and combing hair on ones own. Toileting (Continence): Independently using the toiletgetting to the toilet, transferring on and off, and cleaning oneself afterward. When someone can no longer perform several ADLs without help, it indicates that ongoing care or support is likely needed.What Are IADLs (Instrumental Activities of Daily Living)?Instrumental Activities of Daily Living (IADLs) are more complex tasks that allow a person to live independently in the community. While not necessarily performed daily, they are essential for managing ones household and life. Key IADLs include: Shopping for Essentials: The ability to shop for groceries, pick up prescriptions, or purchase clothing and other necessities. Meal Preparation: Planning and cooking mealsgathering ingredients and safely using kitchen appliances. Housekeeping: Keeping the home clean and livable tasks like cleaning, laundry, and taking out the trash. Money Management: Handling finances, such as paying bills on time, managing bank accounts, and budgeting. Transportation: Getting around or arranging transportationdriving oneself or using public transit or rides to run errands and attend appointments. Medication Management: Managing and taking medications properly remembering to take the correct medicines at scheduled times and refilling prescriptions. Communication: Using the phone or computer to communicatelooking up phone numbers, making calls, sending emails, and staying in touch with others. Trouble with IADLs is often one of the first signs that someone needs more support, even if basic ADLs are unaffected.Why ADLs and IADLs Matter for Medicaid Waiver EligibilityIn Pennsylvania, needing help with ADLs and IADLs is a central eligibility criterion for the CHC and PDA Waiver programs. These waivers serve individuals who would otherwise qualify for nursing facility care but prefer to remain in their own homes or community settings. Eligibility is determined through both financial and functional assessments. The functional assessment evaluates whether an individual requires hands-on assistance with ADLs and/or significant help with IADLs, thereby meeting a nursing facility level of care. Pennsylvania uses standardized toolsoften the Pennsylvania LongTerm Care Assessment System (PaLTAS) or the Minimum Data SetHome Care (MDSHC)to score independence in ADLs and IADLs.During the functional evaluation, an assessor reviews abilities such as transferring from bed to chair, walking safely, eating, toileting, meal preparation, housekeeping, medication management, and managing money. Cognitive issuessuch as memory problems due to dementiaare also considered since they impact daily functioning. If an individual cannot perform multiple ADLs without assistance or has significant deficits in IADLs, they are likely to meet the level-of-care requirement and become eligible for waiver services.Community HealthChoices (CHC) WaiverCommunity HealthChoices (CHC) is Pennsylvanias comprehensive HCBS waiver program for individuals aged 21 and older who require a nursing facility level of care. Administered by the Office of Long-Term Living (OLTL), CHC is a managed care program that combines physical health, long-term services and supports, and pharmacy benefits under a single plan (with behavioral health carved out). To qualify for CHC: Be age 21 or older. Meet Medicaid financial eligibility guidelines. Require a nursing facility level of care (confirmed through functional assessment). Live in a setting that meets HCBS requirements (e.g., home, apartment, assisted living). Be a Pennsylvania resident. Once enrolled, participants receive a comprehensive package of services tailored to their needs. Covered services may include personal assistance, home-delivered meals, adult day services, behavioral support, professional nursing, home modifications, assistive technology, transportation, and respite care. CHC also offers Participant-Directed Services, allowing participants to recruit, hire, train, and supervise their own caregiversoften family membersto assist with ADLs (bathing, dressing, toileting) and IADLs (meal preparation, medication reminders).PDA Waiver (Council on Aging Waiver)The Pennsylvania Department of Aging (PDA) Waiver, also called the Council on Aging Waiver, serves seniors aged 60 and over who require nursing facility level of care but choose to remain at home or in other community-based settings like domiciliary care homes. To qualify: Be age 60 or older. Meet Medicaid financial eligibility requirements. Be assessed as requiring nursing facility level of care (through the functional assessment). Live in a qualifying community setting. Covered services under the PDA Waiver may include personal care assistance, home-delivered meals, homemaker services, personal emergency response systems, respite care, adult day services, minor home modifications, and transportation. Like CHC, the PDA Waiver emphasizes managing ADL and IADL needs to keep participants safely in their homes.Participant-Directed ServicesBoth CHC and the PDA Waiver offer Participant-Directed Services, which empower participants to choose and manage their own caregivers, including family members, friends, or neighbors. Under this model, participants develop a service plan with guidance from a care coordinator, set schedules, and handle payroll tasks. This flexibility helps ensure that personal care and IADL support align with participants preferences and routines.Signs That Your Loved One May QualifyBelow are practical indicators that someone may be eligible for Pennsylvanias CHC or PDA Waiver due to difficulty with ADLs and IADLs: Trouble with Personal Care: Skipping showers, unkempt hair, or wearing dirty clothes may indicate difficulties with bathing and dressing (ADLs). Malnutrition or Weight Loss: An empty fridge or significant weight loss suggests issues with meal prep or feeding oneself (ADLs/IADLs). Mobility Decline and Falls: Struggling to walk without assistance, needing help to stand, or experiencing frequent falls signals reduced mobility (ADL: transferring/ambulating). Medication Errors and Memory Problems: Missing doses, mixing up pills, or forgetting appointments point to challenges with medication management and scheduling (IADLs). Household Neglect: Piles of mail, unpaid bills, or a cluttered home reflect trouble with housekeeping and money management (IADLs). A combination of needing help with several ADLslike bathing and toiletingand difficulties with IADLssuch as meal prep and housekeepingstrongly indicates a nursing facility level of care. Document these challenges for the functional assessment to demonstrate eligibility.Were Here to Help: Next Steps and Contact InformationNavigating Pennsylvanias Medicaid waiver programs can be complex, but you dont have to go it alone. At Passion to Care, we specialize in guiding Pennsylvania families through the CHC and PDA Waiver application processesfrom the initial functional assessment of ADLs and IADLs to completing paperwork and coordinating services once approved. If you notice your loved one struggling with daily tasks or if a professional has recommended nursing facility care, it may be time to explore CHC or the PDA Waiver. Our compassionate, family-first team ensures your loved ones needs are met with dignity and respect. Call us or contact us today to learn how to get started with Pennsylvanias Medicaid waivers for home and community-based services.
Theres a quote about the importance of setting goals that says, If you dont know where youre going, any path will take you there. You probably have dreams about retirement, vacations, hobbies and more. But if you dont have a strategy with financial goals in place, you may not make the choices that can best set you on the path to achieve those dreams. Setting goals helps define and showcase your purpose, passions and priorities. And establishing your own strong financial goals can help you earn and enjoy a wide variety of short- and long-term achievements throughout your life. When you reach your financial goals, you can feel a sense of accomplishment in seeing your efforts literally pay off. But how do you get started? Prioritize your needs and wants. Think about the things that are most important to you and then outline them as financial must-haves and wish-list targets. Start with the big-ticket items and work through to ideas that may not cost as much. A must-have for many people is having enough to live comfortably through retirement. Being able to afford the college of your child's choice, without incurring mounds of debt, is another. Your wish list, on the other hand, may include things like saving for vacations, hobbies or entertainment expenses. Create detailed short- and long-term goals within your financial strategy. Its important to be specific about the goals you want to achieve and how much youll need to achieve them. One way to do this is by making your goals measurable. Assign estimated dates and costs to each goal so you can plan how much to save and how much time you have before you need the money. For example, for your retirement goal, be specific about how many years before you want to retire. And once you do, how you plan to spend your time perhaps traveling the world, turning your hobby into a business or taking your grandkids on outings. These can have vastly different price tags.Be willing to compromise. Reaching one, or more, of your goals may mean compromising. If your must-have is building your dream home but it's not looking quite affordable, you may need to make a trade-off build it a bit smaller, work a year or two longer or trade in some of your wish-list goals so you can stay focused on your must-haves. Hold yourself accountable to stay on track. Once your strategy is in place, its not a set-and-forget exercise. Actively tracking your progress and managing your decisions and actions can help you be better positioned to reach your goals. Use time-tested principles for making financial decisions, not predictions. Diversify, own quality investments and keep a realistic perspective, especially for your long-term goals. Maintain your focus and dont let your emotions control your investment decisions. It can be helpful to meet with a financial advisor at least annually to review your full financial strategy, address any changes in your life or your goals, and discuss your progress and new ideas.As you achieve certain milestones, celebrate them. You may even want to refresh your outlook with new goals. Take pride in your ability to strategize and accomplish a personal financial goal for yourself by following the path you envisioned and created. Chad Choate III, AAMS 828 3rd Avenue West Bradenton, FL 34205 941-462-2445 chad.chaote@edwardjones.comThis article was written by Edward Jones for use by your local Edward Jones Financial Advisor. Edward Jones, Member SIPC