Increasing longevity means people are enjoying longer lives, but it has also led to an alarming increase in the prevalence of illnesses, such as dementia and Alzheimer’s disease, that require long-term care.
More and more families are having to pay for facilities such as frail care, or for hiring help at home, or are losing the income of a family member who stays at home to care for an elderly relative.
The number of people living with dementia worldwide was estimated at 47.47 million in 2015, and it is expected to reach 75.63 million in 2030 and 135.46 million in 2050, according to the World Health Organisation. Alzheimer’s SA regional director Jill Robson estimates some 850 000 South Africans have dementia or Alzheimer’s.
If a member of your family has one of these illnesses, or one of a host of others that leave older people unable to care for themselves, you will need to provide full-time care over what may be a long period.
This is what is referred to in the United States as long-term care. The US health department estimates that 70 percent of people reaching age 65 can expect to have some form of long-term care during their lives.
DementiaSA’s website says statistics show that dementia affects one in 20 people over the age of 65 and one in five people over the age of 80.
Robson says frail-care facilities vary from R2 000 a month to R45 000 a month, depending on whether or not they are subsidised. Retirement villages’ frail care typically costs between R17 000 and R25 000 a month, she says. Waiting lists can also be a problem if you need care urgently.
Some retirement villages are now also insisting that frail-care residents with a condition such as dementia or Alzheimer’s that requires 24-hour one-on-one care must pay for additional carers on top of the frail-care fees.
Hiring a carer to assist in frail care or at home is not cheap either. A Cape Town agency that provides trained carers, Cape Care Agency, says you will need to hire four carers to provide care 24 hours a day, seven days a week and the cost will be between R25 000 and R30 000 a month.
If, in addition, you require a nursing sister to, for example, oversee tube feeding at the later stages of an illness, your costs will be higher.
Adult nappies and medication are additional expenses. Medication for Alzheimer’s or dementia can easily cost R1 000 a month, with much of it not covered by medical schemes other than from a member’s medical savings account.
Dementia and Alzheimer’s are not covered by the prescribed minimum benefits (PMBs) for medical schemes and schemes typically do not cover the prescribed medication. However, other illnesses requiring long-term care, such as Parkinson’s disease, are covered by the PMBs.
Most medical schemes, barring a few restricted schemes such as Bankmed, do not pay the costs of frail care when you need this care because of frailty that comes with old age or mental incapacity. They typically pay for frail-care services only when you are recovering from an operation or illness or when you need palliative (pain relief and comfort) care when your illness is terminal.
Kate Brown, a financial planner at Fiscal Private Client Services, says it is important for carers to look after themselves and ensure they are always cheerful. When family members are doing the caring, they need to take good breaks from their duties, and if there is no family or friend to do this, the carer’s family should pay for relief care, which is, of course, an additional cost.
* September is Alzheimer’s and Dementia Awareness Month, and Wednesday is World Alzheimer’s Day.
NO POWER TO ACT
More than 15 years after the South African Law Commission launched a project to look into the legal position of mentally incapable adults and their families, there is still no cheap way for these families to manage their loved ones’ affairs. Although you can get a power of attorney to act on behalf of a frail parent or relative, as soon as that person loses the mental ability to grant the power of attorney, it is no longer legally enforceable.
Families then need to approach the High Court to have a curator appointed for their mentally incapacitated relative, a process that can cost R100 000, Louis Venter, a senior manager of private clients at global advisory and administration firm Maitland, says.
In practice, many families continue to use the power of attorney.
Eight years after the Law Commission’s project was launched in 2001, draft legislation was proposed in Parliament suggesting various alternatives. A revised draft bill was presented first in 2013 and then again in 2014 and 2015, but Parliament has yet to deal with the bill, Venter says.
Venter says seven percent of the population is affected by mental incapacity and the lack of a cheap and easy way for their families to deal with their affairs “has not given rise to a single moan, headline or even a lofty election promise”.
“The plight of the mentally disabled has gone to the bottom of the legislator's pile. It is up to individual citizens to approach the courts for assistance, because antiquated legislation fails to protect the most vulnerable ones,” he says.
COURT APPROVAL FOR GROWTH ASSETS
The Pretoria High Court has granted relief to the curator acting for two people living with Alzheimer’s Disease by allowing the curator to invest their money in growth assets rather than cash, thereby protecting their investments from the damaging effects of inflation.
Global advisory and administration firm Maitland, the curator for the couple, applied to the court for an order allowing it to manage the couple’s investment assets in a trust controlled by a trustee appointed under the provisions of the Trust Property Control Act, rather than the outdated Administration of Estates Act.
Louis Venter, a senior manager of private clients at Maitland, says the current Administration of Estates Act “practically compels” curators to invest the liquid assets of their clients in cash or cash-like instruments.
In addition, the curator’s fees are limited to a percentage of the income that arises from these investments.
Venter says this pits the curator’s and the client’s interests against each other if the client needs inflation-beating capital growth and the two restrictions have damaged the wealth of clients over many years.
Accepted investment practice is to allocate a portion of the investment funds to cash and cash-like assets for short- and medium-term stability and to allocate the remainder of the investment to inflation-beating equity and property investments, he says.
Curators can ask the Master of the High Court for permission to allocate some funds into “risky investments”, but this means an official at the Master’s Office has to make an investment call and this has resulted in approval of such requests being difficult to obtain.
In the Pretoria High Court case, the court agreed that Maitland could invest the couple’s funds in a prudent manner in line with accepted investment principles, and that the remuneration of the trustee would not be limited to the income, but could be based on a percentage of the capital value of the investments.