 Aloha, everyone. Thank you for joining me on Think Tech Hawaii. I am Shonda Park, your host for Money Talks. My guest on our last show was Raeanne Ischevez, and we spoke about health-related financial hardships, specifically terminal illness in children. Today, Raeanne is back to talk about long-term care and health-related financial hardships. She is going to share her knowledge on this topic, that a lot of people have been affected by it, either personally or has known someone that has needed some type of long-term care in their family. And so, just like the last show, a very unpopular topic, however, it's information that is greatly needed. So, Raeanne, thank you for being back on the show today. Hi, Shonda. Thank you so much for having me. Yes, so the things that people need to talk about is not very popular. However, we see what families, many, many families are still going through. So will you please share? What is long-term care and who needs it? Yeah, so long-term care is a very interesting topic, right? So before we get started, actually, you know, so this is what we'll talk about today, right? On the screen, you can see some of what we'll talk about is what is it, right? I think there's a lot of misconceptions around what is long-term care, who needs it, right, and what is the cost, and ultimately, who will pay for it, right? So these are the things that we want to cover today. So that's a whole lot we're going to be talking about today. But before I get started, Shonda, you know, one of the things that is really shocking is the reasons why people file for bankruptcy. So have you ever thought about, you know, the number one reason why people file for bankruptcy? No, I have not given that thought. So it's quite interesting because when you think about bankruptcy in your mind, right, we kind of think about mismanage finances. You know, it kind of has like a negative, you know, you kind of think negatively sometimes when you think about bankruptcy. However, as you'll see on the screen very shortly, the number one reason why people actually file for personal bankruptcy is due to medical-related costs, right? So, you know, studies show that 66.5% of all personal bankruptcies is due to medical expenses and health care-related costs. So that's a huge deal, you know, so it's unfortunate because it's something I think is one of the most challenging things to plan for is health care, right? Because we don't know, we may not know the extent of how much it will cost us because we don't know, again, the extent of our care and for how long. And so that's why you can see that it can put a major strain on people's finances and therefore we see now the number one reason for people filing bankruptcy due to these medical costs. 66%, that's a very high percentage. Yeah, it's pretty significant. So can you imagine, you know, the stress that it puts on the family? And we briefly touched up on that, you know, how it can affect every single member of the family. And on your other show, we talked about the children and now we're going to talk a little bit more about the adults, right, and some of the health care challenges that we may run into. Okay, so explain what is long-term care. So what is long-term care, right? So actually, so before I start explaining what is long-term care, Shonda, can I ask you how you started your day today? Like, what was the first thing you did when you woke up in the morning? Jumped out of bed. You jumped out of bed, okay, so you jumped out of bed, and then what did you do next? I went to use the bathroom. Okay, so you went to use the bathroom, and then what did you do? What did you do? Okay, very good. Shower. Shower, and then got dressed, got ready, put on makeup, did my hair, got dressed, and drove to the office. Did you have breakfast? No. Actually, I know you're not a breakfast person, but typically most people do, right? And with everything that you did, did you even give it a second thought about your day? Like, immediately when you woke up and jumped out of bed, did you even have to think about it? Didn't have to think about a thing. It's just, it's habit. It's habit, right? And it's just something that we do routinely every single day. Okay. So now what I'm going to ask you to do again is, you know, reverse, right? Think again about the start of your day, your in bed, and now imagine not being able to do any of the things that you just said you did. I can't even imagine that. Yeah, so, you know, so many people go through it. So that, you know, in a nutshell is what long-term care is. So imagine if, you know, you woke up however you now, instead of being able to jump right out of bed like we normally do and don't even think about, imagine now needing help to get out of bed, right? Imagine now needing help to use, you know, basic things like use the bathroom, take a shower, you know, have breakfast, right? So on the screen, you'll see it lists what we call the six activities of daily living. So again, these are the things that you know we normally do right on a daily basis. So it's the person long-term care is a personal and medical care needed if you become disabled due to age or adverse health conditions, right? So if you can't perform some of the following on your own, you may need long-term care, right? Again, transferring, bathing, continents, that's feeding, right? So those are the basic things, activities of daily living that we do again on a daily basis without even thought, now we need some form of assistance, right? So you can kind of see how this subject can be so challenging, right? Because again, some people, in order to qualify for long-term care, you actually only need to assistance with two out of the six, not all of them. And again, it says it's related to old age or adverse health condition, right? So it can happen pretty much anytime. At what age is a person eligible to be able to put a long-term care plan in place for themselves? That's actually a really great question because, you know, a lot of times, so first let me show you the statistics, right? So on the screen, you're going to see that 70% of adults who live to age 65 develop a severe long-term care need, right? So I think a lot of times when we talk about long-term care, we think immediately about seniors, right? We think about, okay, so the big question is, okay, we understand long-term, we have an idea of what long-term care now is now. But when we think about, okay, who is the age or the demographics that will actually need that kind of support, we always think about adults. And it's true, you can see on the screen, right? It says 70% of adults who live to age 65. So typically, as we age, we're more at risk, a health risk. We, you know, we tend to be more sick. We tend to be more accident prone. And therefore, as we age, you know, we see that that's the highest risk of needing long-term care. However, if you see the second half of the screen, right, you can see that 48% of adults, right, 18 and older receive some sort of long-term care benefit in their lifetime. Okay, so it's not just age-related. Really, it can happen at any time. So one of the things that always comes to mind when we talk about this topic of long-term care is Superman. So do you remember the original Superman? I do remember he fell off a horse and became a paraplegic, right? Yes, so Mr. Christopher Reeves, right? He was known for Superman. And he actually, so that horse accident happened at age 42. So at, you know, the prime time of his career doing really well. He loved to ride horses. I think he was on some kind of writing for a competition at that time. And, you know, he just, he basically, he was thrown off of his horse and then landed on his head. And I think I read somewhere that just a centimeter to just what a centimeter off he would have been able to walk. You know, so it's just a very unfortunate accident. But every time I think about long-term care happening to really anybody, I'm always reminded of Christopher Reeves because as we know that accident caused him to be paralyzed from the neck down. Right? So, and he was very young, only 42 years old. So we can see that, you know, unfortunate accidents like horse from horse riding, car accidents, even accidents at work, really any disability, right? Whatever the cause is, health-related or an accident can put us in a situation where now we're needing some assistance with the things that we do on a normal, on a daily basis. I don't know if you have these answers, but just off chance, did you know if Christopher Reeves had long-term care or if they needed to deplete all of his assets in order to pay for his health-related costs? That's actually a great question. I have not read his book. However, I heard that he wrote a book about, you know, his story and what happened in the type of care that he needed. And one of the things that I remember reading online was that he mentioned that he was very fortunate to have amassed wealth due to his career. As a movie star, he was able to amass a certain amount of wealth and that afforded him the care that he needed because he actually talked about how he needed, you know, medical equipment that insurance companies wouldn't cover or certain types of treatments that the insurance companies wouldn't cover. And so he talked about how, you know, he was very fortunate to be in a position to afford these things and therefore, you know, be able to live another 10 years, right? So, you know, and I think that's why he became such a huge advocate for, you know, sitting and, you know, his condition and being able to be a resource. He started a foundation to be able to support people who financially couldn't afford what he could afford for his care. So I don't know if he had long-term care insurance, but I do know that he had enough, you know, built enough wealth to be able to take care of himself and have, you know, care pretty much around the clock, right? So he had, his wife did not care, like, she cared for him, but they had nurses pretty much around the clock, right? So he could afford that type of care. Yes. But his situation, of course, we all know is different. And for mostly the general population, they are not in that, you know, position where he shared that he was very fortunate. So, you know, looking at your other slide to 48% of 18 and older, that is almost half. And so again, with people thinking that you only need it after age 65, you know, we can see the statistics that 48% is 18 and older. Yes. And that's a huge point to make, right? Because we never know. And again, that's why planning for healthcare is one of the, I think the biggest challenges that we have. Because for one, we don't know exactly how much it's going to cost. And two, sometimes we don't even think about it. Again, when we think about health, we always kind of default to, okay, well, that's something I need to think about as I age or get older, right? And sometimes we may not know or understand the severity of, you know, the care and support that's needed until we ourselves experience a situation like that, right? And I think, especially certain cultures or in Hawaii, right, we want to take care of our families or loved ones or kakuna. And so we tend to actually carry the burden for, you know, taking care of the family members, right? Because a lot of times we don't really have a choice when it comes to care. Yes, like you said, we're not, you know, most of us are not in a financial position like Christopher Reeves to be able to have multiple nurses and care around the clock and equipment to help him, you know, still be able to thrive. And so many times, long term care, not only does it fall on the individual that is experiencing it, but really it's a challenge that affects the entire family. Yeah, I agree. And I have a really good friend that unfortunately just lost her mom fairly recent and her mom ended up needing long term care did not have any long term care solutions in place for her. And so what happened was my friend's dad, so her parents were divorced, but her mom needed to move in with her ex husband, because there was no other space for them to take care of her. And so my friend would have to go, you know, to her dad's place and take care of her mom. And so it was very stressful. I could see how taxing it was on her and her kids and her whole entire family, even her dad, you know, being that they weren't even married for years. And here his ex wife is in his home, and the family is having to care for her there. And I, again, I just seen how stressful it was physically, emotionally, mentally, financially. And so I had asked my, my good friend after her mom had passed. Do you have a long term care plan in place, because you already experienced, you know, what happened with your mom needing long term care not having it and the burden that it put on the family. You have three kids, you don't want to repeat that. So, you know, I spoke to her about long term care being again being what she experienced with her mom. Yes. And, you know, you, it's, it's unfortunate and a lot of times, we think that it's the only solution because, you know, when we actually look at the cost right because I think that's a big question I think a lot of times, you know, and, first of all, of course, we do want to provide care for our loved ones right we want to care for them. And many times, we make a financial choice. The, or we make that choice because of finances right so when we look at the actual cost of long term care. You know, it can arrange so widely right so we see anywhere from 17,000 a year, all the way up to almost 100,000 a year. That's pretty significant right so. And again, keep in mind right these numbers are actually national numbers. And so, you know, as we know in Hawaii, it can be very expensive here right so some of the services can range from having some similar costs or significantly more, you know, right before our, you know, show today Shonda I looked at Jenworth long term care so you can look this up right Jenworth. Cost of care for long term care it shows you the national costs and it also it also shows you a comparison of the different states right and in Hawaii for a private nursing private room in a nursing home, you're looking at double the cost of that. Wow, 180,000. Okay, so that is very, very significant. And so when we see that right that those those numbers are very shocking. I mean most people in Hawaii, well, I don't know what the percentage but you know do people even make 180,000 a year. And then when they're not even able to make any more income, they have to spend 180,000 a year for their long term care. Yes, because now we're only talking about long term care services right so if you can see right adult day care center which is the lowest cost 17,000 a year. It's because if we think about it, you know, it's only for a few hours that means that for a few hours a day, you know, we're, we're able to get care at an adult day center. However, we still have to provide care at home, right and or some people choose to get to receive care at home and so they have a homemaker or home health aid, because again, it's the things that we do on a daily basis right that's why depending on the type of assistance we need and how much assistance we need, you know, we could end up paying anywhere from 17,000 a year to 92,000 a year. And unfortunately without having a plan in place, it ends up being the child, their children's job, right to take care of them. And I had, being a retired parodontal hygienist I had a patient, and she was sitting in my chair. She had a, you know, a diaper on and just very, very sharp still you know, mentally very sharp right just, you know, her body was not functioning as it used to. And she said, I have to use a bathroom. You know, I think I pooped my pants. And she stood up and she walked and it actually, you know, fell out of her diaper. And so she went to the bathroom and just made a huge mess and the son was there in the waiting room. And we had to give him gloves and you know disinfectants to clean up his mom clean up the bathroom and he was very frustrated, angry. He was scolding her and yelling at her and it was just very, very sad to see, you know, on both ends because maybe beautiful memories that he had with his mom. It's now, you know, going to be replaced with all the caregiving that he had to do. Right. And then that's going to be the lasting memories of his mom after she passes away. And it's just a very, very unfortunate on both sides for, for the parent and the child. Yes, you know, it's unfortunate and like you said, you know, a lot of people don't like talking about this, but we, and that's the reason why we want to talk about it on the show right because we need to have these conversations. In fact, this is something that we need to talk about as a family, because like what we talked about earlier, you know, it, it not only affects the individual but it actually affects the entire family. And I think, especially when it comes to costs, I think a lot of times there's misconceptions on how it's paid out. Right. So sometimes we don't even think about it because we think, OK, well, if it's health related, you know, our medical insurance is going to cover it. They should have Medicare, you know, at the time so should cover. So those are, you know, some of the things that there's a lot of misconception around who will pay for this cost. Right. And so the families need to have a conversation about this while the individuals are still of sound line and can, you know, plan ahead of time. The kind of care that they would want to receive because, you know, I think one of the things that like you talked about, right. And people, they don't, I think people want to keep their independence. Right. And I think they want to, they lose a little bit of dignity maybe when they're in that position of needing care. And so, you know, we want to. Make this by talking about this, I feel like, yes, we may still have to experience the chat, all the challenges that come with it. But again, at least take out some of the burden of the financial burdens of going through this and having options is so important because a lot of times, you know, when we have to take care of our loved ones, again, we have to either cut our hours, we have to leave work, you know, if there are other siblings, they have to alternate sometimes because there are lots of siblings don't live in the same state. There's just so many things other than the care itself that is involved. And so that's why it needs to, we need to start talking about it. Yes, I agree. So what are some of the solutions and how can people plan for this in terms of getting long term care and building that strong financial foundation. Yeah, so the financial foundation, as you know, we always talk about this, right. This is really the core principle that we have. When we talk about people's finances, we always want to look at our financial foundation. And when we look at our financial foundation in terms of long term care, we go back to proper protection, right. So, when we have proper protection when that means income replacement that means health care. Right. So we want to make sure that we have a plan in place also to be able to pay for things such as long term care. And today, there are actually so many different types of solutions that you can put in place. You know, there's a traditional long term care plan. There are hybrid plans, you know, on the financial foundation we saw that of course we also want to work on building our investment, right. You could be you could be self-insured like or, you know, have enough wealth build up to be able to take care of your long term care needs, right, like Christopher Reeves. So, you know, there's so many different ways that we can pay for this without having to, you know, burden or put, you know, additional financial burden on our family members. And so, and on the other end, right, if family members are prepared, they have emergency funds to be able to take off of work, right. They also have their they've also built up enough wealth to be able to take care of themselves during this time of need where they can be there for their family. That's also important too, right. So, again, like what we talked about the financial house is really identifying, you know, how can we build our house strong. Because if you think about it, even within our own homes, right, we don't, we don't really know how strong our house is until something happens, right, like a natural disaster. Same thing with our finances, we don't necessarily know how strong our financial houses until something happens, such as, you know, meeting long term care services. And so, you know, I do encourage people to, again, have these conversations with your loved ones. Understand what it is. Understand, you know, your what you have in place and know that, you know, because it's it may even know what causes you to need services is health related. The services that you need is not health care services. That's why insurance doesn't cover it at health insurance doesn't cover it. So we need another plan in place to be able to pay for care that can support us through, you know, this time. Thank you for sharing all your knowledge on this subject matter of long term care. I know it's a very heavy topic. There's so much information. I know that you do teach workshops on this. If anyone wants more information, you can contact Rhian directly. She actually teaches about long term care and many other financial concepts. So thank you for sharing about how people can put a plan in place. Have long term care lesson the burden on themselves on their families on their financial house. So long term care awareness month is in November, we can expand on that so see you all next month. Thank you. Thank you. Thank you so much for watching think tech Hawaii. If you like what we do, please like us and click the subscribe button on YouTube and the follow button on Vimeo. You can also follow us on Facebook, Instagram, Twitter and LinkedIn and donate to us at think tech Hawaii.com. Mahalo.