The idea of shouldering the cost of nursing home care, choosing between your kids' education and your parents' long-term care, or seeing your savings consumed by long-term care costs is daunting. The very possibility may already have prompted talks between you and your folks about long-term care coverage.

Long-term care may include care in a nursing home and medical and personal care at home. Medicare covers only a fraction of long-term care costs and, even then, only in certain situations. As a result, you and your parents must understand Medicare's benefits and limits, and plan ahead for whatever expenses they may incur. You also need to discuss who will care for your folks when they need help, what kind of care they want, and where they will live as they age.

Determine the Level of Care Needed

When your parents are no longer able to live independently and appear to need some help taking care of themselves, the first step is to determine the type of care they need. Evaluating care options is easier once you know the range and extent of services they require. Often, you and other family members are best equipped to make this assessment, since you know your parents’ situation and how much day-to-day help they really need. If you prefer, you can hire a geriatric care manager, nurse, or social worker for a professional evaluation. If your parents are eligible for Medicaid, a state social worker sometimes will do this assessment without charge.

Explore Long-Term Care Options

There are a number of different ways to meet your aging parents’ long-term care needs, ranging from a few hours of personal assistance in the home to skilled, round-the-clock care in a nursing home. Depending on your parents’ needs and preferences, there are several home-, community-, and institutionally based services available to them. You may especially want to discuss whether your parents want to stay in their own home or whether they would feel comfortable in an outside facility.

Home-based care
Many older people prefer to remain in their own homes rather than move into a supervised facility when they need long-term care. If your parents elect to stay at home, you, and they, may need to consider how much care they will require. For example, will they need help in the middle of the night, or a few hours of personal assistance several days each week? You may need to put together a "patchwork" of formal and informal caregivers and services. Formal services may include visiting nursing services, home health aides, and such social service programs as "Meals on Wheels." You can look for services in your parents’ community by calling the local Area Agency on Aging or the Eldercare Locator at 1-800-677-1116.

Quite often informal caregivers -- family members and friends -- end up providing a large share of assistance. To supplement care giving in the home, some families use community-based services such as adult daycare and senior centers. Call your local Area Agency on Aging to find out about available services in your parents’ neighborhood.

If home-based care is the most appropriate solution to your parents’ long-term care needs, you should consider simple adaptations to the home to make it a safe and comfortable environment. Improvements may include appropriate lighting, railings, well-secured carpeting, and quick access to emergency response if needed.

If it becomes too difficult or too expensive to provide long-term care at home, a supervised living facility, such as an assisted living facility or nursing home, may be an option.

Continuing care retirement communities
These facilities offer long-term contracts that usually provide lifelong shelter and access to specified health care services. To be admitted, large advance payments often are required. Eligibility for new residents is generally based on age, financial assets, income level, and physical health and mobility. Residents usually are expected to move into a continuing care community while they are still independent and able to care for themselves. Find out what happens when they become sick or frail and can no longer live independently. Does the retirement community have a nursing facility on the premises? What if the nursing facility is full when they require that level of care? What happens if your folks run out of money?

Assisted living facilities
These facilities (also called "board and care" or "adult care"), are usually in a residential or home-like setting. Most provide meals, housekeeping, and some assistance with activities of daily living such as dressing and bathing. Some of these facilities care for people who require skilled nursing and 24-hour attentive supervision. Find out where your parents will get their health care, whether they will continue to see their doctors, and how they will get to their appointments. Health care services may be delivered at the facility itself or elsewhere, through an arrangement with another provider such as a hospital. Ask what happens (both in terms of services and price) if your parents’ condition declines after they enter an assisted living facility. Some facilities may discharge your parents if their health care needs increase considerably.

Nursing homes
These facilities provide custodial and skilled care prescribed by doctors and delivered by registered nurses, licensed practical nurses, and certified nurse assistants. Find out whether your folks can get physical, occupational, and other therapy, and whether Medicare or Medicaid will pick up the cost. Costs and quality of care can vary considerably. Be sure to ask if the nursing home meets Medicare and Medicaid quality standards.