Financial Planning for End-of-Life Care: The Unexpected Cost of Palliative Care in Canada
By permission of author Dr Valorie Masuda, Palliative Care Physician at Island Health, edited for length.
Being diagnosed with a terminal illness will have a significant psychological and social impact on you and your loved ones. It will be important for you to consider these issues as you are developing strategies to assist you from the diagnosis of a terminal illness. Financial discussions should also begin early in the treatment process. This will ease the burden for the family and the patient through the year, months and final weeks of Palliative Care.
[This article will address the reader as you, the patient, although the reader may be a friend or family member who is involved in the care of a patient encountering the unexpected decisions and costs of palliative care.]
There is a predictable course of increasing care needs as time passes regardless of diagnosis of a terminal illness. You, the patient, will become more frail and need help with day-to-day activities. When you have been diagnosed with a terminal illness, it is difficult to think about the end stage of your life. However, while you are feeling well is the time to start planning how you want to be cared for during your last months.
Currently, the public healthcare system cannot provide 24-hour care at home. Depending on where you live and your access to resources, you may be able to access homecare which can provide 1-4 hours of public funded health care when you become more frail. Many people rely on family members or friends for support. If only 1 or 2 family members are caring for a person for 24 hours a day for a month or two - this can cause the caregivers to burn out and places a great burden of guilt and/or financial strain on family. Canadian studies show that 70-90% of personal end of life care is provided by family members.
For those who want to be cared for in their own home it takes planning and open conversation between family members. Will your family be able to dress you, bathe you and toilet you? Will your family be capable of giving medications - including injectable medications at end of life to keep you comfortable? Will your family be capable of providing care day and night without a break?
So how does one find others to help care for them? What is the cost? This is a frank discussion about the cost of end-of-life care and Ontario resources which can be used to supplement these costs and support family caregivers through the palliative process.
Initial stage of diagnosis of a terminal illness
At this point you may not have the energy to work, but you still have energy to do your personal care and some housekeeping chores. This is a time to start planning! Now is the time to take stock of your financial resources and predict costs. If you have COPD, heart failure, liver failure, dementia, or other illnesses the rate of decline is less predictable. With some illnesses, a patient may stabilize but still be quite frail for many months (sometimes years). In this case, these individuals are much better considering a complex care home if they don’t have family who can support those care needs for the longer duration.
With cancer the rate of decline can be slowed with chemotherapy. Planning still must occur as sometimes when chemotherapy stops working, the disease can progress very rapidly and not give time for preparation.
Explore your supports
Who in your friends and family are willing to commit to the following?
1) Driving you to appointments as necessary
2) Helping you with groceries
3) Helping you with gardening/snow removal
4) Helping you with maintenance and chores
5) Helping you with caring for another family member who needs care?
6) As you become more frail who can help with bathing, toileting and giving medications?
7) At the end stage of disease are there people who would be available to be with you 24/7 if you are receiving palliative care at home?
8) Would you choose hospice care or do you expect you will be in a nursing home/hospital at the end stage of your illness and are there costs associated with this?
Plan for future care
If you think that you will need 24-hour care at home or in a supportive living facility for up to 2 months (sometimes a lot less, sometimes more) you can predict the cost.
Private care through a private nursing company is $40-80/hour (lower rates for support workers and higher rates for licensed nurses) = $60,000 to $100,000 for 2 months of 24-hour care. Costs are tax deductible. Some employer provided extended health insurance benefits will cover some of these costs so check with your provider.
You may consider hiring your own personal support workers at $30-40/hr = $43,000 - $60,000 for two months of 24-hour care. If you do this, you (or your power of attorney) must set-up as an employer, have a Business Number with Revenue Canada and formally hire people to provide care. This includes providing wages and submitting payroll to Revenue Canada and arranging coverage for the worker(s) under WSIB Ontario. The wages you pay are deductible expenses from your taxable income.
A combination option may also work if you have family caregivers for 8-12 hour a day then hire someone for 4- 8 hours a day to support family caregivers. This can run $7,000 to $40,000 for two months.
Compassionate EI benefits
Once you require care, a family member who is working and qualifies for Employment Insurance Benefits, can apply for Compassionate EI benefits for up to 6 months of coverage. This will start at the time you need care. These EI benefits can also be split amongst employed eligible family members.
EI only covers 55% of a person’s earnings so often family cannot afford this pay reduction. However, you might consider topping this up to their regular pay rate if you can afford this from your income. This may be less expensive than hiring private nursing care.
Some family members may have access to paid personal leave which would allow them to help care for you. You would want them to save this time for when you need care, not when you are relatively well.
The following are suggestions about possible resources which may be available to you. You may require a financial consultant or lawyer to explore these options in depth.
If you have a terminal illness, you can apply for terminal illness CPP. This is a resource available to you if you have paid into CPP benefits. The wait is much shorter than applying for regular CPP.
If you are unable to work due to terminal illness and you qualify for EI, you can apply for EI through Service Canada.
If you have long term disability with your employer, now is the time to apply for this.
If you have extended health benefits through your employer or through your pension, you may qualify for money to cover nursing care and equipment. You should have the required forms sent to you so a health care professional can complete them when you are closer to requiring nursing care.
If you are a Veteran, you may qualify for extended medical benefits. Now is the time to inquire as to whether this will cover nursing care and how much. Have them send you all the required forms so you have the resources on hand when you qualify for nursing care.
Many Life Insurance companies are willing to give you an advance on your life insurance if you have a terminal illness. You can use this money to pay for nursing care when you need it. Call your life insurance providers. Check to see if you have life insurance connected to your mortgage or credit cards as well.
Many people have Critical Illness Insurance. Now would be the time to apply for the money once you are diagnosed with a terminal illness.
If you have paid into this insurance policy, contact your provider to see if you quality for nursing care at home in the case of terminal illness.
Many people have a significant asset in their home. Talk to your financial advisor or banker. Many banks will give you a line of credit based on the amount of equity you have in your home. You pay interest only on the money that you use. If you don’t use any money from it, there is generally no charge.
Once you start using your line of credit, you are required to pay the interest on the amount owing. Interest payments are often affordable even on reduced income. After death, the money you used in the line of credit can be paid off by your estate. If you have another person living in your home and the estate doesn’t have the money to pay off the line of credit, the home can be mortgaged again to absorb the line of credit. Make sure that anyone who will be living in the home after your death has their name on the Title - or that your Will is clear about the disposition of the home after your death.
Look into whether you qualify to have your property tax deferred. Many municipalities in Ontario offer this to low-income seniors. The property tax is paid when the home is sold. You can also see if your bank or credit card companies can lower payments or temporarily freeze payments however this may be an expensive cost to your estate.
There is never a penalty for accessing your RRSP or RRIF at any age - you can withdraw it at any time, but it is regarded as taxable income. When you file your tax return what you withdrew from your RRSP is added to your taxable income. Remember that private nursing care, medical equipment and medications are tax deductible, so that the tax liability for paying for care may be quite low. This can also apply to withdrawing RRSP monies to pay for medical costs for a spouse or dependent.
Every year, you pay for your prescription medications until you reach your deductible, if you do not have third party medical insurance. Your deductible is calculated based on your last tax return. This is a financial burden if you have expensive medications. Call the Ontario Trillium Foundation https://www.otf.ca/ and explain that your income has been reduced or medical expenses are a financial burden. They will let you know if you quality for free prescription medications under this program.
As well, many drugs that are designed to prevent illness are very expensive, such as blood pressure medications or cholesterol medications. Ask your doctor if these medications are necessary for your care if you are suffering from a terminal illness.
The Toronto based not-for-profit organization Closing the Gap has a lot of information about palliative care costs which is available on their website
You may also check out the Speak Out Ontario web site for information on advance care planning and in-depth discussion of options for a power of attorney for personal care.
Technical terms for Medical Orders for End-of-life Treatment
As the terminal illness progresses the physician will discuss with the patient the best level of emergency intervention based on the person’s prognosis and personal values. This conversation will be documented, and a medical order will be put on the medical chart. Usually, these orders are documented as a level of care. Different institutions use different terminology, below is an example of what a care level may imply:
Care is for physical, psychological, and spiritual preparation for an expected or imminent death. Do not transfer to higher level of care unless to address comfort measures that cannot be met in current location. Allow for natural death.
Most patients with a terminal illness opt for level 3 if they are undergoing life prolonging treatments, such as chemotherapy, dialysis, surgery, total parenteral nutrition, and other interventions. Patients with a terminal illness usually opt for level 2 if they want antibiotics or fluids or transfusions or surgery or radiation for symptom control only. Patients who do not want any life prolonging interventions opt for level 1. At this level Palliative Care comfort is increased.
Intermediate stage of End-of-Life care
At this point you are needing help with simple things - showering, dressing, food preparation. In 2-4 weeks, you may be not able to be independently mobile and need help with all personal care. This is a time to prepare for the next stage.
Now is the time to start planning to have nursing care in place. If you have no money for private nursing care, you must connect with your family doctor or palliative care team to arrange for public health care to support your caregivers in providing care for you. If you live alone, you need to connect with your family doctor and palliative care team about planning a move to a facility which would provide 24-hour nursing care, which may be a nursing home, a hospice care facility or dedicated ward in a hospital.
If you have finances available for private nursing care, now is the time to arrange for that care to be in place and available when you are unable to care for yourself.
If you have not done so already, this is the time to arrange how your body will be treated after you die. Exploring these options now, instead of leaving the decisions to family, is a gift to your family for a time when they will be faced with a myriad of decisions while grieving. A funeral director can come to your home if you have not yet made pre-arrangements for a funeral or memorial service. You may choose to simply pre-plan the funeral and record your wishes or pre-pay for a funeral. See the Funeral Cc-operative of Ottawa web site for a complete funeral planning guide
Medical Assistance in Dying (MAiD)
Medical Assistance in Dying is offered in Canada. This is euthanasia for persons who feel that their terminal disease is causing irremediable suffering. To access euthanasia arrange a discussion with your treating physician who will ensure that you are referred to the appropriate medical team for an assessment. You can withdraw your request for Medical Assistance in Dying at any time.
Palliative Care in end stage illness
At this time you will be unable to move from bed or chair without assistance and be dependent on others 24 hours a day. This is a time where your caregivers need maximum support to prevent burnout. If you have insurance or you can afford private nursing care, usually 4 hours 2-3 times a week is needed to cope with the increased care. In 2-4 weeks, you may be completely bed bound.
Sometimes the unexpected happens. When you are quite frail, you are at high risk to die at any time from a fall or infection or a complication of your disease. If you are at home your medical team should complete an Expected Death in The Home (EDITH) form. This form allows your caregiver to call a physician to declare that a death has occurred at home without the requirement of calling police or ambulance. Once the physician has signed a death certificate the family may contact the funeral home to collect the remains.
Palliative Care the final stages
At this stage you are spending most of your time asleep and don’t have the energy to swallow food or fluids. This stage is only 1-2 weeks. You will require 24-hour care and if you are home your caregivers may be required to give you your medications by injection with the support of your palliative home care team. This is done by placing a permanent line into a vein under the skin which allows the administration of medications.
Towards the end a dying person is unable to wake up at all. They are unable to direct their care and preparations for passing now undertaken. If you have requested MAiD, you cannot give consent for this procedure unless you have already booked a time for MAiD. At this point your substitute decision maker may give consent for the procedure to be done.
Planning closure for the family and your executor.
After a person get over the shock of a terminal diagnosis, they may come to realize that they have the gift of time to prepare themselves and their families for closure and to organize our estate. Many people take the time to create a summary of their family life, careers, hobbies and other important things in their lives. This greatly helps those who will be writing your obituary.
Ensuring that your finances are in order is a gift you can leave your loved ones. In today's world creating a list of your passwords for Internet and social media accounts and giving them to trusted loved ones will provide substantial assistance when you are too unwell to manage these affairs or after you have died.
There are some useful tools online to help the executor through the initial steps of closing an estate. More complex estates may require an accountant who specializes in estate closure. Nevertheless, early on the family should know who will take responsibility for notifying government agencies, employers, family, and friends of your death. Make this an easy task by creating a list of people with their contact information, including emails.
There are several good programs which can be purchased to keep track of all passwords and security codes so that your executor only needs one password to access everything from your email, Facebook accounts, bank card PINs and codes for your phone voice mail.
Closing an estate can be expensive and time consuming as well as emotionally fraught. As Canadians we are fortunate to have publicly funded medical care, but this article is a reminder that not all medical expenses are covered, and we are wise to anticipate personal costs in out end of life care. Above all, the first step in the trajectory of palliative care is to prepare for the final steps which will be left to your family and friends after your death.