A typical couple would have to save nearly $200,000 to pay for their out-of-pocket medical costs from the time they are 65 until they die, according to an important new study by the Center for Retirement Research at Boston College. Add in nursing home costs, and they are likely to need $260,000.

But that's only part of the story. About 5 percent of 65-year-old couples will face catastrophic medical and long-term care costs exceeding $570,000, according to researchers Anthony Webb and Natalia Zhivan.They estimate those expenses would have exhausted the total financial assets of 85 percent of all retirees even at the peak of the stock market in 2007.

These conclusions are similar to prior studies by others, including Paul Fronstin at the Employee Benefit Research Institute. But they are nonetheless hair-raising. It is especially important to keep in mind that these costs are for people who already have Medicare. Indeed, those expenses include premiums for Medicare Part B and Part D (the drug benefit), Medicare Supplement (Medigap) insurance, retiree health insurance. and copayments for services not fluly covered by Medicare.  

Lots to chew over here, especially as we think about health reform, the CLASS Act, and the need for private long-term care insurance.    

Mike Vitez at the Philadelphia Inquirer has done a great story on palliative care at a community hospital. Mike weaves the deeply touching story of Mary Tole, a 74-year-old woman who spent two months in the suburban Philadelphia hospital with an undiagnosed illness. She spent much of that time in an intensive care bed in a coma. 

Mike describes how the hospital's palliative care team and Mary's family struggled with how much treatment she should get, or whether she should be allowed to die as comfortably as possible. He also talks about the cost of her care--$775,000--Medicare's role, and Mary's out-of-pocket expense: $900.

This piece is an excellent antidote to all the foolishness and misinformation in the debate over "death panels" last summer. There is no more difficult or complex subject than end-of-life care. And Mary and her family still struggle to confront what happened to her, and what they will do when she again faces such a medical crisis.

As individuals, as family caregivers, and as a society, we need to address this issue head-on, and recognize there are no simple answers. Mike's story helps us do that. 

Congress made a horrible mistake when it allowed itself to be bludgeoned into dropping a provision of health reform that would have allowed Medicare to pay doctors to discuss end-of-life issues with patients.Mary's story is an example of the price we all pay for not having that conversation.   

The compromise health reform plan proposed today by President Obama includes many of the key long-term care provisions that were included in the earlier House and Senate bills. The CLASS Act--the national long-term care insurance program--along with federal incentives to encourage states to expand their home and community based care programs under Medicaid, and improved care coordination for those receiving both Medicare and Medicaid are all included in the Obama plan.

The White House summary released this morning leaves out many details, but the important news is that the White House is putting its weight behind these important long-term care proposals. According to the White House description, the CLASS Act remains a voluntary, self-funded insurance plan that makes a cash benefit available to those who need assistance with activities of daily living.

The White House says, "no taxpayer funds will be used to pay benefits" under CLASS. However, the Obama version also makes what the summary calls "a series of changes" to the Senate version of CLASS, although those adjustments are not described.

Similarly, the Obama plan retains proposals that give states more flexibility--and more federal money--to offer home and community-based long-term care.

The fate of the package remains unknown. Many of the health and long-term care provisions have been strongly opposed by Republicans and some moderate Democrats. We'll know more after Obama's health summit on Thursday. But, for now, critical long-term care proposals live.     

While the United States struggles to figure out how it is going to pay for long-term care, it is important for policymakers, care providers, and those of us caring for our parents to see how other countries do it. The Commonwealth Fund has just published my new paper, LongTerm Care Financing Reform: Lessons from the U.S. and Abroad  that looks at where the U.S. is in its efforts, and how the rest of the world already finances this critical assistance.     

What I found is interesting, challenging, and, in the end, encouraging. If the rest of the dveloped world can do this, so can the U.S.

Two decades ago, most developed nations realized that their systems for paying for long-term care services were headed for failure. They paid unlimited care costs, but only for the very poor--and they sharply restricted what services the frail elderly and younger people with disabilities could receive. While most countries had long since established national insurance programs for medical care, nearly all excluded long-term care. This model, which copied welfare-like Medicaid in the U.S., failed in two ways: It was financially unsustainable and provided unsatisfactory care.   

At that point, the world split. The U.S. tried to fix things by encouraging the middle-class to buy private long-term care insurance. Both the states and the federal government provided new tax subsidies for private insurance. The government offered long-term care insurance to federal workers and created a new marketing campaign to teach the public about their long-term care needs. And the Partnership Program tried to better meld private insurance with Medicaid. 

Despite all these efforts, private long-term care insurance remains only a niche product. Only about 7 million Americans have policies. As a result, many middle-class people who need long-term care have little choice but to spend all of their financial assets on care and, when they run out of money, end up on Medicaid.  

Japan and most of Europe took another tack. Building on their national health systems, they created social insurance programs for long-term care as well. Each country did this in a somewhat different way, but most now have universal government long-term care insurance, at least for the elderly.

In Germany, all workers pay a payroll tax of about 2 percent and, in return. all who need assistance with daily living get benefits--either in cash or in services.

In Japan, the program is funded a bit like Medicare, through a combination of taxes and premiums, and covers about 90 percent of the long-term care costs of the elderly.

In France, long-term care is funded through higher taxes and everyone over 60 gets some cash benefits, although higher-income people get less than the poor. Interestingly,one of result of the French reforms is growing interest in private long-term care insurance to supplement government benefits.

A few countries, such as the United Kingdom, have retained their Medicaid-like systems. But nearly everyone else has headed in a very different direction. The big question is what will the U.S. do now? Will it adopt the CLASS Act, which is a unique voluntary national long-term care insurance program? Will it try some other reforms? Or will it do nothing?

Take a look at the paper and let me know what you think. If you''d like to learn even more, check out my book, Caring for Our Parents (St. Martin's 2009)     

If you think the U.S. is struggling over how to finance long-term care, just take a look at what's happening in the U.K.

There, Prime Minister Gordon Brown, who faces an uphill battle for reelection this spring, has proposed to expand free long-term care to 280,000 of the most needy. His proposal has not only come under fire from the opposition conservatives, but also from many in his own Labour Party and from local governments who'd be responsible for managing the program. One huge concern: Brown won't say how he'd pay for all this extra care,estimated to be at least £670 million per year.

In recent days, there have been hints that he'd use a new estate tax--an idea the Tories instantly jumped on as a"death tax." Here is an excellent column from The Guardian that describes the whole mess.

The saddest result of all this is that last summer Brown began an important process to find a consensus solution to the challenges of long-term care financing. The government put out a serious green paper (white paper to us Yanks) that laid out several creative options. Now, all that has been lost in a morass of partisan electioneering. To those of us caring for our parents who have been watching the debate over health reform and the CLASS Act here in the U.S, it all sounds depressingly familiar.   

Today, The Washington Post and Kaiser Health News jointly published an article I wrote on aging in place villages--an important element in the effort to help seniors remain in their communities. 

There are close to 50 villages now operating around the country, and at least 600 communities interested enough to send representatives to workshops held over the past year by the non-profit community development group NCB Capital Impact.

Villages come in many shapes and sizes, but there are three basic models. One, pioneered by the Community Without Walls in Princeton, N.J. is an all-volunteer group, with modest dues (just $30 for a couple). Beacon Hill Village in Boston relies on a professional staff, provides concierge services to link members with vendors (for services from home health aides to plumbers), and charges substantial dues. The third model, created by the Maryland non-profit Partners In Care, is based on the concept of time-banking. In this design, members  receive credits for their volunteer time which they, in turn, can exchange for the help of other volunteers. 

Different models may work in different communities. But the key to the success of the village movement will come from their bottom-up, community-based nature: Local people pulling together to help one another as they age. It is a powerful concept with a promising future--both for elders and for adult children caring for our parents.       

Those of us who have been caring for our parents know very well the physical toll it takes. I helped care for my dad for 18 months. And after he died, one of the first things I did was make an appointment to see my own doctor. I had never felt so exhausted and worn out in my life.

Now, an important new study describes the health effects of caregiving on workers. And the picture is not pretty. Women caregivers over 50 are twice as likely to report fair or poor health than those not caring for elderly relatives. Men are more likely to smoke. Blue-collar workers are more likely to drink. And caregivers across the board report higher rates of depresssion, diabetes, hypertension, and pulmonary disease.

Overall, the study estimates these workers cost their employers an average of 8 percent more in health care costs, or $13 billion annually. And that's on top of an earlier study that suggests absent or distracted caregivers cost their companies between $17 billion and $33 billion in lost productivity. The toll on these adult children and their employers is enormous.

The new report, called "The MetLife Study of Working Caregivers and Employer Health Care Costs" is a joint project of the MetLife Mature Market Institute, the National Alliance for Caregiving and the University of Pittsburgh.    

A White House task force on meeting the needs of middle-class families today proposed to spend an additional $102 million to assist caregivers of aging relatives. The initiative includes an extra $52.5 million for respite care--a program enacted by Congress in 2006 but never fully funded. 

It is very important that the Obama Administration recognizes that caring for our parents is critical to many middle-class families. But as the task force fact sheet notes, 38 million Americans provide unpaid care to loved ones (other estimates are even higher). So, $102 million comes out to about $3 per family--not exactly a difference maker.

There has been a long history of Washington announcing grand-sounding plans for family caregivers, but never delivering. For instance, the Lifespan Respite Care Act passed four years ago was supposed to provide critical assistance to caregivers. The original law called for spending $71 million this year, but Congress never appropriated anything close to that. In 2009, only $2.3 million was distributed to states.

If the President and Congress follow through on expanding the Lifespan program--a big if--this will help a few families. Better for all of us if Obama works to be sure that bigger long-term care changes survive the health reform debate. For instance, if everyone had some form of long-term care insurance (such as the national government insurance in the CLASS Act) they could spend their daily benefit as they wished, and would not have to rely on underfunded government programs that come and go with the political winds. 

Republican Scott Brown's stunning victory in the Massachusetts Senate race has obviously turned the health reform debate on its head. Without a 60-vote majority in the Senate, Democrats are no longer assured of passing a major health bill. But what will this mean for long-term care reform? 

There are three key long-term supports and services issues at stake--expansion of Medicaid home and community based care, new efforts to coordinate care both for Medicare patients and for those eligible for both Medicare and Medicaid, and the CLASS Act, the proposed national long-term care insurance program.

Keep in mind that the fate of all these measures is tied to broader reform. If the big health bill dies this year, so will long-term care reform.There is no chance Congress will pass a long-term care bill on its own this year.

If the House can pass the Senate version of health reform, these proposals will survive, although not necessarily in the best form. If, as President Obama hinted today, he'd like Congress to try to pass a slimmed-down bipartisan health insurance reform bill, the fate of long-term care will be much dicier.

To start, it is not clear that either Republicans or liberal Democrats want to pass a mini-reform bill. But if they do, would long-term care be in the package?

It is hard to imagine that broad expansion of Medicaid home and community care would be included, because that proposal could be very expensive, and lawmakers will be looking to jettison costly provisions. Care coordination has a better chance since it may be sold as a cost-saving measure.

And what about CLASS? It is harder to say. On one hand, CLASS generates substantial revenues in the first ten years, at least on paper, and that has always been it biggest advantage. However, the proposal has also generated a number of important critics, including both Republicans and nearly a dozen moderate Democrats.

CLASS, for all its benefits, is not essential to health insurance reform. And if Obama wants to get something passed quickly, I suspect he'll dump everything that is at all controversial.

Bottom line: the immediate future of long-term care reform is extremely precarious. But whether it is approved this year or not, the issue has generated more attention than at any time in decades. And as long as millions of us need care, or are caring for our parents or other loved ones, it is not going away.  

Why can't The Washington Post ever get it right when it comes to long-term care. Its latest self-embarrassment came with a piece it ran today comparing elder care in the U.S. with similar assistance in France and the U.K.

According to the author, a psychologist named Sara Mansfield Taber, elderly women in England and France receive far better care than the writer's mother did in the U.S. Unfortunately, she hopelessly confuses health care with long-term care and paints a picture of high-quality personal supports in Europe that I only wish really existed.

In truth, the system of long-term care in England very closely resembles the deeply flawed welfare-like arrangement we have in the U.S. through Medicaid. While nursing care is provided as part of the National Health System, government-supported personal assistance such as home health aides provide is only available for those with few assets and very low incomes.

This is troublingly similar to the U.S, and has been the subject of severe criticism in the U.K. for decades. One scathing 2006 report by the Joseph Rowntree Foundation concluded "the public finds the present system incomprehensible and considers its outcomes unjust." 

Because benefits vary so widely by locale in the U.K. the system is often disparagingly referred to as the "postcode lottery." Indeed, the current labour government of Gordon Brown is proposing major reforms to address some of these perceived inequities.

In France, the author's other model, government long-term care benefits are also based largely on income. Unlike the U.K. and the U.S., where those with more than $2,000 in financial assets and less than $700- a-month in income usually receive no Medicaid benefits, in France everyone who suffers from severe enough disability gets some assistance. However, they face some fairly tough limits. First, to be eligible, a person must be significantly more disabled than in the U.S. Second, benefits are sharply reduced for those not in poverty. The average monthly benefit for someone receiving home care in France is only about $600. And while someone who is very poor gets about $1,400 per month, a person with income of about $4,000-a-month would get less than $300 for home care.

The French middle class has found the public long-term care benefit so insubstantial that about 25 percent of those 65 or older feel the need to purchase private long-term care insurance to supplement this government assistance. Fewer than half that many have bought this insurance in the U.S.

Don't get me wrong, the U.S. system for providing long-term care is shameful. And Congress is finally taking some steps to both expand home care benefits under Medicaid and create a national long-term care insurance program to help middle-class people begin to prepare for their frail old age. But despite what The Post would have you believe, the systems in the U.K., and France are hardly panaceas.

When it comes to long-term care, we all have work to do. Especially The Post, which provided wildly inaccurate commentary on alleged "death panels" last summer, and has been unable to write about long-term care reform in any serious way during the current debate over health care.