MICHELE NORRIS, Host:
This is ALL THINGS CONSIDERED from NPR News. I'm Michele Norris.
MELISSA BLOCK, Host:
And I'm Melissa Block. When aging Americans need long-term care, especially in a nursing home, the costs can be enormous. In this part of the program, we're going to talk about those costs and some options for seniors and their families. And we'll start with a new poll conducted by NPR, the Robert Wood Johnson Foundation, and the Harvard School of Public Health. The poll suggests that even if Americans are wising up about the costs of long-term care, knowing how to pay for it is another matter. Here's NPR's Julie Rovner.
JULIE ROVNER: Earlier this week, 53-year-old Jason Mitchell of Rockville, Maryland, sat down to do something that's still fairly uncharacteristic for people his age: He talked with insurance broker Sally Leimbach about buying private, long-term care insurance.
SALLY LEIMBACH: Right now, I believe you and Nina would actually qualify for the least expensive rates, which means you have the best health. And the older you get, the less likely you'll be able to qualify for those.
JASON MITCHELL: You're saying that rate increase would be based upon a 53-year-old?
LEIMBACH: That's correct.
LEIMBACH: It would be based on a 53-year-old.
MITCHELL: Not where I am at that point.
ROVNER: Mitchell says he and his wife are motivated to make the purchase because they've experienced the cost of long-term care firsthand.
MITCHELL: A few years ago, my dad passed away at 89, and for the two years before passing away, we incurred some pretty high costs for private care. Luckily, he had the means to pay for it, but I recognize, you know, it's probably a bigger risk as all of us are living longer.
ROVNER: Indeed, in our poll, more than two-thirds of people like Mitchell - over 50 but not yet retired - said they were very or somewhat likely to have trouble paying for long-term care if they or a spouse need it. And unless they're very wealthy, that's likely to be the case, says Judy Feder, a Georgetown University policy professor and long-term care expert.
JUDY FEDER: The cost of care in home, which is how most people want to get it, is substantial. And the cost of a nursing home on an annual basis is now about $80,000.
ROVNER: Feder says what's really helping educate people like Jason Mitchell, though, is not the work of people like her, but the one-on-one experience boomers are having with their own family members.
FEDER: One of the reasons I think that people have a better understanding of the likelihood of long-term care is that boomers are experiencing it with their parents, and a lot of the responsibility for helping people who need long-term care falls on children.
ROVNER: But while the public may be better at recognizing the financial threat long-term care expenses pose, there's something people still don't recognize very well. That's which government programs pay long-term care bills.
FLORENCE VERDIN: You know, I'm not sure about that.
ED SOLOMON: I don't know, really.
(SOUNDBITE OF LAUGHTER)
SOLOMON: My wife would know better.
JOAN MATTESON: I really haven't checked. I feel very fortunate because I'm very healthy.
ROVNER: Florence Verdin, Ed Solomon and Joan Matteson all live at the Greenspring Village Retirement Community in Springfield, Virginia. In the poll, more than 40 percent of retirees, and nearly a third of boomers, said they thought the federal Medicare program would pay if they needed long-term nursing home care. That's usually not the case. People who don't have substantial savings or long-term care insurance mostly have to rely on Medicaid. It pays more than half the nation's nursing home bills. Yet Medicaid was only identified as a potential payer by 7 percent of retirees, and 10 percent of not-yet-retired boomers.
ROBERT BLENDON: They just don't see Medicaid playing a central role.
ROVNER: Robert Blendon is a professor at the Harvard School of Public Health who worked on the poll. He says that lack of recognition could soon turn into a major political problem. That's because elected officials at both the federal and state levels are even now looking for places to cut spending, and Medicaid is a big target.
BLENDON: In the budget debates that are coming up, this is really important because these are, really, people at risk of needing this service over their lives. And they just think that they're going to be relying on other sources of insurance or income or savings to pay for it.
ROVNER: And it's unlikely that people will fight very hard for something they don't even know they might need. Julie Rovner, NPR News.
NPR transcripts are created on a rush deadline by Verb8tm, Inc., an NPR contractor, and produced using a proprietary transcription process developed with NPR. This text may not be in its final form and may be updated or revised in the future. Accuracy and availability may vary. The authoritative record of NPR’s programming is the audio record.