Long Term Care Is No Holiday
You’ve seen the commercial.
A surgeon removes his mask as he is finishing an operation when a nurse observes, “You’re not Dr. Stewart!?”
To which he replies, “No, but I did stay at a Holiday Inn Express last night.”
In a financial planning version of life imitating art, there was a story (Exhibit 1) widely reported this week about Terry Robison, a Houston man that posted his plan on Facebook for how he is going to live out his old age in a Holiday Inn instead of a nursing home.
Exhibit 1. Terry Robison’s Facebook Post
No one seemed to notice that Robison was repeating a meme that has been circulating on social media for years. Nor did many note Mr. Robison’s experience, as listed on his Facebook profile, that consists of a varied number of professions and employers. None of which suggests expertise in finance or eldercare.
Producer/Director at Scarlet Tye Films
Owner at Alpine Fire Protection Technology
Former Independent contractor at TWUMC Media Department
Former Independent contractor at Two20Media
Former sales at NEC Business Network Solutions
Former Sales at KONICA MINOLTA
Former Sales at Lawson Products, Inc.
Former Sales at Clarke-Erhe Produce Co.
Former Coach and Teacher at O'Connell School
But the fact that over 100,000 Facebookers, media organizations across the country, and even Jimmy Fallon gave it credence by regurgitating it, suggests that Americans are worried about how they will get by in the final stage of retirement (Exhibit 2).
Exhibit 2. 3 Stages of Retirement
Retirees should plan for different phases of their retirement, including the last stage that is less active and more likely to require Long Term Care.
While simplistic answers to complicated issues always have appeal, rarely do they address the nuances and realities of life. Let’s look at a couple of those issues.
First, Robison’s math doesn’t add up. He claims to have found a Holiday Inn for a rate of $59.23 per night. Yet a search of Holiday Inn’s reservation system for a “Senior Rate” for a 30-day stay in Austin this March ranged from $133.63 - $191.76 per night, and that didn’t include the 12% of additional taxes that would be tacked on. The average between those two rates plus tax would be about $182 per night, or about $5440 per month. That is actually more than “the areas of Texas with the most expensive assisted living,” according to TexasBabyBoomers.com, that “include Amarillo, Austin, Odessa, Victoria and San Antonio, where the monthly cost averages between $4,000 – $4,600.”
Second, hotel staff aren’t trained or expected to provide care. The last time I checked in to a hotel after a late flight, I had to wake up the front desk clerk to get my key. I don’t know about you, but I wouldn’t sleep soundly knowing that I’d have to count on a passing security guard if I need help going to the restroom or if I fell and couldn’t get up in the middle of the night.
As I pointed out in Who Needs Long-Term Care Planning? back in 2017, the average cost of Long Term Care is around $150,000. It’s a coin flip whether you’ll ever need it at all. Medicaid will pay for it if you are destitute. If you are wealthy, you probably should just plan to pay out of pocket. And if you’re somewhere in between, you can buy Long Term Care Insurance to pay some portion of the costs.
No offense to Holiday Inn, but it doesn’t seem very smart to include a hotelier in the mix. Maybe Mr. Robison should sleep on this idea somewhere else.
If you need help planning for how you may deal with any of the stages of retirement, get in touch.