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Cost of Taking Care of Mom and Dad

Overwhelmed caregivers save the U.S. health care system billions in uncompensated care

Stacks of coins chart of annual spending in billions of dollars

1. Kaiser EDU, 2008 figures; 2. Projected U.S. Budget, 2011; 3. AARP Public Policy Institute, 2009 figures; 4. Bureau of Labor Statistics, 2010 figures; 5. IMS Institute, 2010 figures

En español | Family caregivers provided the equivalent of $450 billion worth of care to their adult parents and other loved ones in 2009, an amount that makes caregivers one of the largest and most overlooked pillars of the U.S. health care system, according to a new report by the AARP Public Policy Institute, "Valuing the Invaluable: The Growing Contributions and Costs of Family Caregiving, 2011 Update."

See also: Are you overwhelmed caring for someone else?

This figure, which puts a dollar value on every meal prepared, every call made to an insurance company and every time a caregiver helped an older adult bathe or dress, is nearly as much as the government spent on Medicare in 2009 and nearly four times what Medicaid itself paid for long-term care services. It's an estimate that explains why caregivers are so overwhelmed and in dire need of support, says Lynn Feinberg, senior strategic policy adviser at the AARP Public Policy Institute.

"It's difficult to find paid help to supplement the care family provides at home," Feinberg says. "There's a shortage of quality home care aides; with the economic downturn, people are having a harder time paying for the extra care; and public programs are shrinking — many states now have waiting lists."

"We have to recognize that in the United States, caregiving comes at a cost. We need to provide better support to families in their caregiving roles. Because otherwise, our whole long-term care and health care systems will almost collapse."

Significant findings include:

  • People who take care of others are devoting nearly 20 hours per week on average to caregiving duties, often while still working a full-time job.
  • Caregiving costs have increased 20 percent over the last estimate of $375 million two years ago.
  • Caregivers provide 1.4 billion trips per year for older adults who no longer drive.
  • Caregivers are using their own personal savings — or diverting money for their own health care needs — to help cover the $5,000 annual average out-of-pocket cost for caregiving.
  • Caregivers are also leaving the workforce earlier than they would, losing an average of $115,900 in wages, $137,980 in Social Security benefits and $50,000 in pension benefits.

Next: What about the physical strain on the caregiver? >>

A higher price to pay

But the burden of that $450 billion in uncompensated care goes beyond the economic. According to the report, between 40 and 70 percent of caregivers display symptoms of clinical depression. As many as a third of caregivers perceive their own health as fair to poor, and caregivers of people with dementia were more likely to have their own health problems, sleep problems and even dementia themselves than a person caring for someone without memory-related ailments.

woman hugging a man - uncompensated caregiving costs have climbed to $450 billion annually

Caregiving cost impacts family finances, health, careers and quality of life. — Photo by Hilda M. Perez/Newscom

This physical strain on the caregiver — and not the health of the older relative — is often the reason a parent winds up in a nursing home, says Howard Gleckman, resident fellow at the Urban Institute and author of Caring for Our Parents. But nursing homes are expensive. In the United States the median annual rate for a semi-private room is $70,445, but the cost can reach over $200,000 a year. If a family can't pay that themselves, then Medicaid is the only option.

"If all those families who are providing family care and do not have the financial resources to pay those fees turn to Medicaid, it would break the back of a system that's already deeply stressed," says Gleckman.

Is there a solution?

What caregivers need, experts say, are services such as support groups and information centers that will help them balance their own lives, as well as education regarding the physical, legal and emotional demands of caregiving.

"One of the big flaws in the system is that we have very little training for caregivers," says Gleckman. "Learning to transfer somebody [from bed to wheelchair], for example, is a skill. If you don't know the skill, you can hurt yourself. You can hurt the person you're trying to care for. We're expecting family members to be able to do it and we don't teach them how."

Next: Caregivers are in dire need of financial support. >>

Caregivers' and aging adults' need for resources comes at a time when the political climate seeks cuts to spending on social programs. So while some solutions exist — long-term care insurance planning as part of the Affordable Care Act, grants to states from the fiscally modest National Family Caregiver Support Program and the formation of the White House Task Force on the Middle Class — experts say real solutions will have to come from the grassroots level.

Cynthia Ramnarace writes about families and health. She lives in New York.

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