November 19, 2020

How to Approach Family Finances and Affording a Care Manager

Many families understand that caring for a loved one can be expensive, particularly depending on the level of care they need or the lifestyle they want to maintain as they age. Some families might be able to afford care out-of-pocket, or by withdrawing a client’s retirement savings to go toward these efforts. 

More often than not, however, families often find themselves struggling to find the money needed to provide the level of care they want for their aging loved one. Care managers can help guide families through the process of finding funding through a number of ways. 

Start during your intake

Your pre-assessment process should include a robust financial component that gives you a sense of what families are working with in terms of a budget. Having as much financial information up front can make later conversations about payment and, sometimes more importantly, overall care affordability much easier and productive. 

Be sure to frame this part of your assessment questionnaire as a positive and important part of your overall care plan. If you can demonstrate to families that you’re working alongside them to determine what they can afford, and where the money can come from, you will be able to make these conversations feel less thorny.

Charge on a Sliding Scale

Charging fees on a sliding scale is a common practice for care managers, and can help you retain families that might not be able to afford cost at a higher price. Families with more money to put toward their loved one’s care can shoulder a higher fee, while families with less money for care can pay a more affordable rate. This is a diplomatic approach to providing your services, and can also help you retain a solid client base—especially if you’re just starting your practice.

Use a Cost of Care Pricing Tool

Offering your services at a right-sized price is one common strategy for approaching the financials of providing care. This may not be the best approach to begin with, however, as it’s likely that families have more financial resources at their disposal than they might even realize.

Worthright’s cost of care pricing tool helps care managers and families by tallying their current sources of financing that can go toward care, as well as potentially untapped resources that might otherwise go without being noticed. For example, families can often sell a loved one’s life insurance plan for a lump-sum payment. This provides additional financial resources that can go to care when it’s needed, rather than disbursing funds upon the policyholder’s passing. 

Set up a Billing Plan

Making sure invoices go out and, most important, get paid on time is essential for a well-run business. You can’t operate successfully if you’re unable to get paid on time and consistently, but many care managers struggle to keep this part of their business humming.

There are several reasons why care managers might have a hard time with billing. As professionals who are inherently compassionate, financial conversations might be hard to talk about when the primary objective is to provide care for someone in need. Keeping track of invoices is another common challenge, particularly for overburdened care managers who might not feel like they have time to keep track of which families have been billed, paid their invoices, or are overdue on payment.

Setting up a billing plan with your clients is the first step toward having a reliable and steady positive cash flow for your practice. No matter what you charge your clients, you’ll want to set up a steady invoicing period and specific period by which families are expected to pay you (also known as net terms). Most net terms are either due upon receipt (for immediate payment), due within 15 business days (also known as “net 15”), or due within 30 business days (net 30). You can decide what terms you want to set up with your families depending on how quickly you need payment (and how quickly they can afford to pay you).

Approaching Family Finances: The Bottom Line

As difficult as it might sound to talk about finances with your clients and families, offering a structured plan with concrete payment terms can make the conversation more procedural and, with any luck, a bit less uncomfortable. The more straightforward your billing process, the better: not just for your own financial management (more on that in the next chapter), but for your families as well. If you’re able to help families find funding they didn’t know they had, you can turn a challenging conversation into one that reaffirms your role as an advocate for the best interests of their loved one.

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