Financial Reality

Background
When Mom sold her house for $450,000 early in 2002 at age 83, I figured she was set for life financially, with that amount in CDs and her monthly retirement income of $4,700. And I figured each of her four children would inherit a nice amount.
But my brother Bill said, "She will go through it in medical bills before she dies. Most people do." He's a surgeon, and in following elderly patients, he has seen it happen.
Nevertheless, my siblings and I set her up in a nice residence, first for independent living, later for assisted living, and now for assisted living for the mentally impaired because of her dementia.
She didn't use much of her capital until she fell and broke her hip in August, 2004, and even then the cost of her care in a skilled nursing facility approximately equaled her income.
The cost went up when we decided to move her out of the grim SNF with its hospital-like atmosphere into a much nicer assisted living residence. That was about $7,000 per month for the maximum level of care, which she needed--incontinence care, bathing, dressing and undressing, being taken to meals and put to bed.
But when I realized that she was getting out of her chair or bed and falling, I learned that assisted living facilties are not licensed to use any form of restraint. The only way to keep her in that residence safely was to hire a private caregiver to attend her and verbally restrain her. That's when the costs skyrocketed.
We paid $14 per hour, at first during the daytime hours (8 hrs. supplemented by a 2-4 hr. visit from me or my sister), then also 6 pm to 6 am, finally 24 hrs. per day.
The alternative was to put her back into a SNF, where she would be strapped into a chair during the day and strapped into a hospital bed at night (or kept in a bed with full-length bars raised instead of a restraint over her waist. (Assisted living facilities are not licensed to use any form of restraint.)
All this care kept her safe--and it even saved her life when she had an allergic reaction at 1 am in June, 2005, and the caregiver was able to respond and call 911 when her swollen tongue and throat had blocked her breathing.
Cutting back on care
In January I reduced her care to 16 hours per day in order to slow the drain on her financial resources. I counted on her being less able to climb out of bed at night than she had been over a year ago and also on her understanding the rules of her life by now--that she can't get out of bed in the night alone.
But still she was angry with me--she was used to having someone at her side to respond to her fears and dreams during the night, as well as to give her a sip of orange juice, put soothing music on the CD player, and change her Depends.
She told anyone who would listen, "Anne's trying to kill me." That was her explanation for why I had removed the night caregivers.
Financial Review of 2005
During this past week in order to gather Mom's financial records to send to the kind CPA who does her taxes, I entered her income and expenses into Quicken.
The results were shocking. Her income was excellent--$83,000. But we had paid $85,000 for her room, board and care in assisted living. And we had paid $105,000 on top of that for the private caregivers.
All this because of her dementia--to keep her from getting out of her chair or bed and falling, and to give her someone to dress her, tend to her, and talk with her. This one-on-one relationship is excellent for her mental health--it keeps her depression, anxiety, and hallucinations in check.
But at this rate her money will last only one more year, and it looks as if her health may last several more years.
Life Expectancy--A Guessing Game
When she had her broken hip, Bill said that 50% of those her age who break a hip die within a year. Based on that statistic, we spent money freely to give her the best possible arrangements for her last year or two.
But now her health has stabilized, with all this excellent care. Her doctor says that at age 87 one's life expectancy is four years. How Lewy Body Dementia will affect that time period is anyone's guess.
At any rate, we now need to make sure her remaining $200,000 will last for several more years.
Further reductions in caregiver hours
My conclusion is that we have to give up the private caregivers, gradually. She now has 16 hours of care per day: one caregiver 6 am to 2 pm, and one 2 pm to 10 pm. I decided to tell each of them that we have to cut back to four hours in the morning and four hours in the evening.
That would mean that she would still be dressed and started in the morning by a private caregiver, 6 am to 10 am, and she would still have her evening routine including daily bath unchanged, 6 pm to 10 pm.
I broke this news to each of her caregivers, and I also told them that I would understand if they decided they could not work only four hours. After all, they only get paid $12 per hour after the agency takes $2 per hour, so that means they commute and work 8 hours for only $96. Commuting and working 4 hours for only $48 might not be worth their time, but I hope they each will continue with her. She knows them and is used to their care.