[Joint House and Senate Hearing, 110 Congress]
[From the U.S. Government Publishing Office]


                                                        S. Hrg. 110-163
 
   ARE THE EXPLOSIVE COSTS OF ELDER CARE HURTING FAMILY FINANCES AND 
                         BUSINESS COMPETITION? 
======================================================================= 



                                HEARING

                               before the

                        JOINT ECONOMIC COMMITTEE
                     CONGRESS OF THE UNITED STATES

                       ONE HUNDRED TENTH CONGRESS

                             FIRST SESSION

                               __________

                              MAY 16, 2007

                               __________

          Printed for the use of the Joint Economic Committee

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                        JOINT ECONOMIC COMMITTEE

    [Created pursuant to Sec. 5(a) of Public Law 304, 79th Congress]

SENATE                               HOUSE OF REPRESENTATIVES
Charles E. Schumer, Chairman         Carolyn B. Maloney, New York
Edward M. Kennedy, Massachusetts     Maurice D. Hinchey, New York
Jeff Bingaman, New Mexico            Baron P. Hill, Indiana
Amy Klobuchar, Minnesota             Loretta Sanchez,  California
Robert P. Casey, Jr., Pennsylvania   Elijah Cummings, Maryland
Jim Webb, Virginia                   Lloyd Doggett, Texas
Sam Brownback, Kansas                Jim Saxton, New Jersey, Ranking 
John Sununu, New Hampshire               Minority
Jim DeMint, South Carolina           Kevin Brady, Texas
Robert F. Bennett, Utah              Phil English, Pennsylvania
                                     Ron Paul, Texas

                      (Vacant) Executive Director
           Katherine Beirne, Deputy Staff Director for Policy
             Christopher J. Frenze, Minority Staff Director











                            C O N T E N T S

                              ----------                              

                                Members

Hon. Amy Klobuchar, presiding, a U.S. Senator from Minnesota.....     1
Hon. Loretta Sanchez, a U.S. Representative from California......     3
Hon. Charles Schumer, Chairman, a U.S. Senator from New York.....    13
Hon. Robert P. Casey Jr., a U.S. Senator from Pennsylvania.......    14

                               Witnesses

Statement of Dr. Richard W. Johnson, principal research 
  associate, The Urban Institute.................................     4
Statement of Virginia Morris, Author of ``How to Care for Aging 
  Parents,'' Sag Harbor, New York................................     6
Statement of Leni Wilcox, division director, Community Services 
  for the Elderly, Amherst H. Wilder Foundation, St. Paul 
  Minnesota......................................................     9
Statement of Scott A. Weisberg, vice president, Compensation, 
  Benefits and Staffing, General Mills, Inc., Minneapolis, 
  Minnesota......................................................    11

                       Submissions for the Record

Prepared statement of Senator Charles E. Schumer, Chairman.......    26
Prepared statement of Senator Amy Klobuchar......................    26
Prepared statement of Senator Robert P. Casey, Jr................    28
Prepared statement of Representative Carolyn B. Maloney, Vice 
  Chair..........................................................    28
Prepared statement of Dr. Richard W. Johnson, principal research 
  associate, The Urban Institute.................................    29
Prepared statement of Virginia Morris, Author of ``How to Care 
  for Aging Parents,'' Sag Harbor, New York......................    36
Prepared statement of Leni Wilcox, division director, Community 
  Services for the Elderly, Amherst H. Wilder Foundation, St. 
  Paul Minnesota.................................................    40
Prepared statement of Scott A. Weisberg, vice president, 
  Compensation, Benefits and Staffing, General Mills, Inc., 
  Minneapolis, Minnesota.........................................    43


   ARE THE EXPLOSIVE COSTS OF ELDER CARE HURTING FAMILY FINANCES AND 
                         BUSINESS COMPETITION?

                              ----------                              


                        WEDNESDAY, MAY 16, 2007

                     Congress of the United States,
                                  Joint Economic Committee,
                                                    Washington, DC.
     The Committee met at 9:30 a.m., in room 216 of the Senate 
Hart Building, the Honorable Amy Klobuchar presiding.
    Senators present: Casey, Klobuchar, and Schumer.
    Representatives present. Sanchez.
    Staff members present: Christina Baumgardner, Katie Beirne, 
Colleen Healy, Zach Luck, Kasia Murray, Robert Weingart, and 
Adam Wilson.

 OPENING STATEMENT OF HON. AMY KLOBUCHAR, A U.S. SENATOR FROM 
                           MINNESOTA

    Senator Klobuchar [presiding]. I would like to call the 
meeting of the Joint Economic Committee to order. I want to 
thank everyone for being here for this important hearing. It is 
one of the first hearings we have had in Congress about what 
they call the ``sandwich generation,'' which is the issue of 
adult children who are caring for their own children and also 
for their own parents. Just in general, the issue of elder care 
has been discussed in the Congress, but it is clearly a growing 
issue.
    We have a number of very good expert witnesses here today. 
We are going to be joined by a number of Senators. I know 
Senator Schumer is coming, and I believe Senator Casey is 
coming. I am going to let them, when they come in, give their 
statements. We also have Congresswoman Sanchez here today.
    I am going to make a brief statement, and then we are going 
to have Congresswoman Sanchez speak, and then we will proceed 
to our great panel of witnesses, and ask each of you to speak 
for about 5 minutes and then we will have some questions. Thank 
you very much for being here.
    I wanted to thank Chairman Schumer and Vice Chairwoman 
Maloney for graciously giving me the opportunity call this 
hearing, examining the economic impact of caring for our 
Nation's elderly and what it has done to our American families 
and businesses.
    I have a little experience with this myself with my mom. 
She is 80 years old now and is still living at home. We have 
some discussions about this every so often. She has had a 
couple knee surgeries. I also have a child who is 11 years old, 
and I knew that this was a balance the day that I had to give a 
presentation for work. I was going to visit my mom in the 
hospital. I couldn't figure out what to do with my 11-year-old 
daughter, and ended up with the decision that I would get the 
nurses in the hospital to allow her to ``visit'' my mother on 
her own for an hour. I think this is a minor example compared 
to what I have heard from across our State where many people 
are struggling with middle class issues of rising health care 
costs and child care costs, and rising college tuition costs. 
They are struggling to do what is right for their families.
    In going around our State, I have talked to a number of 
caregivers. Their stories are heart warming in what they do for 
their parents, and how much they love their parents, but they 
also are heart-breaking because a number of them have quit 
their jobs, or have sacrificed a lot because they do not have 
the kind of support system within their own family that could 
help them with what should be a time that should not be as 
difficult as it so often is.
    In many respects, this whole issue is a success story for 
our society. So many of our seniors are able to enjoy long and 
fulfilling lives. According to the Centers for Disease Control, 
a baby born today is expected to live well into his or her 
eighties, almost 35 years longer than a baby born at the turn 
of the 20th Century.
    But as Americans are living longer, their needs for support 
are growing. Today, almost 10 million Americans, or more than 
one-third of the Nation's senior population, needs some form of 
long-term care.
    While nursing homes and paid care providers support our 
elderly in some situations, the vast majority of elder care 
comes from informal caregivers, more than half of whom are 
adult children taking care of their parents.
    Today our adult daughters and sons are increasingly 
responsible for helping their parents with tasks ranging from 
the mundane, like shopping for groceries and helping with 
chores around the house, to much more difficult tasks like 
taking care of personal finances and helping to make major 
health care decisions.
    While our adult children want to provide this type of care 
to their parents, they are feeling increasingly overwhelmed. 
They are stressed for time. They are tired.
    They are frustrated with the fragmented, costly, and 
confusing system of services. And they are faced with financial 
challenges in caring for their aging parents.
    Almost two-third of adult children who care for their 
parents work. Many report that to meet their care giving 
obligations, they need to take time off, to cut back on their 
hours, or to turn down opportunities for training or promotion.
    They do this at the same time they are trying to make ends 
meet, save for their own retirement and putting their children 
through college. Therefore, it is not surprising that as more 
families are caring for elderly relatives in their later years, 
more need help with the costs of care.
    To help ease the burdens on caregivers, our public 
policies, our business practices, and our family customs need 
to keep pace with the changing demographics of our society.
    We have a lot of suggestions for what can be done here, and 
I think we are just at the beginning of this discussion today. 
I have introduced, along with Senator Schumer and others, a 
modest proposal to help middle class families get a tax credit 
to cover expenses incurred by families as they care for an 
aging parent.
    We have also talked about how we can make some of the 
services we are going to hear about today, the best practices 
available across the country.
    We have talked about the issue of long-term care. In some 
instances, we have heard that long-term care does not appear to 
be working. I think only approximately 10 percent of our 
seniors have long-term care insurance right now. That is 
another part of this puzzle.
    I look forward to hearing from our panelists today. I want 
to thank you for being here. I think you all come from 
different perspectives, and thank you very much and we look 
forward to your testimony.
    [The prepared statement of Senator Klobuchar appears in the 
Submissions for the Record on page 26.]

       OPENING STATEMENT OF HON. LORETTA SANCHEZ, A U.S. 
                 REPRESENTATIVE FROM CALIFORNIA

    Representative Sanchez. Thank you, Senator. And thank you 
so much for caring so much about this topic.
    You were just discussing a little bit here about 
caregivers. We all ask ourselves what does a caregiver look 
like? Well, you are looking at one.
    I have a father who has Alzheimer's, and luckily I have six 
brothers and sisters who share the burden. We do not really 
look at it as a burden, obviously, because we are trying to 
share the last moments, possible moments, with my father. But 
it is an intense struggle to juggle schedules, to make the time 
commitment, to do the finances, and luckily my brothers and 
sisters are all very successful and they want to do this.
    So for our family, I find it overwhelming when we have to, 
with two Congresswomen in the family, find the time and spare 
my brother because my Dad's in my brother's home, my younger 
brother, and he is just amazing. He runs his own business. His 
girlfriend works full time, goes to school full time; she has 
aging grandparents that she goes to at 8 a.m. on a Saturday 
morning and cleans their house, and goes grocery shopping for 
them to fill up the place for the rest of the week, and still 
comes home and, you know, handles my father who is in diapers 
and everything. It is just an amazing thing to watch what 
people really can do because they love their parents.
    But for a family that does not have children, or a family 
that has children that do not want to take care of their 
parents, or a family that only has one child, the very 
fragmented pieces of our long-term care out there and what is 
available I think really makes a lot of burden on our families.
    Every family is going to be facing this in our Nation as we 
all grow older. So I am very excited to be here and to listen 
to what our experts have to say, because we really do need to 
help our families address this issue.
    It is a very difficult one, and I think in particular--
thank God it is not in my family so much--but there are a lot 
of families where we talk about explosive costs of elder care 
and how they handle this, and how it takes away from the rest 
of the family, and how people lose their jobs, and how they 
have to stay home, et cetera.
    In particular, I am very interested also because minority 
communities do not typically use the services that are out 
there. And why there are those obstacles or those barriers and 
how we can also help them is not just a cultural issue of 
wanting to keep our parents in the home. There are a lot of 
other things going on.
    So I think this hearing is incredibly important, and I 
really look forward to working with you to find some solutions 
for our working families.
    Thank you.
    Senator Klobuchar. Thank you very much, Congresswoman.
    I would now like to introduce our distinguished panel. I am 
going to introduce all four of them and then have you each 
speak in this order:
    First, Dr. Johnson. Dr. Richard Johnson is an economist and 
principal research associate at the Urban Institute where his 
research has focused on long-term care and the economic burden 
of providing unpaid elder care. Dr. Johnson is an expert on 
health and income security at older ages.
    Second, Virginia Morris. Ms. Morris is an award-winning 
journalist and the author of ``How To Care for Aging Parents,'' 
a guide to help adult children caring for their elderly parents 
deal with the financial, legal, medical, and other issues 
involved in care giving.
    Congresswoman Sanchez, you can get her book. That would be 
helpful.
    Leni Wilcox. Ms. Wilcox is division director of the Amherst 
H. Wilder Foundation's Community Services for the Elderly in 
St. Paul, Minnesota. This nonprofit provides community-based 
long-term care service to the elderly and caregivers, and I 
personally visited with a number of the caregivers involved in 
this program and I can tell you it is top notch and a good 
example of some of the good work that is going on across the 
country.
    Finally, Scott Weisberg. Mr. Weisberg is vice president for 
Compensation, Benefits and Staffing for General Mills. He 
oversees the development and administration of benefits for the 
company's 28,000 world-wide employees, and they have been doing 
some innovative work in the area of elder care as well.
    Dr. Johnson, would you like to begin.

STATEMENT OF DR. RICHARD JOHNSON, PRINCIPAL RESEARCH ASSOCIATE, 
              THE URBAN INSTITUTE, WASHINGTON, DC

    Dr. Johnson. Thank you, Chairman Klobuchar, and Members of 
the Committee, for the opportunity to testify today about the 
challenges confronting family caregivers.
    My research over the past 15 years has taught me three 
things:
    First, that family caregivers, especially adult daughters, 
provide crucial support to frail older Americans.
    Second, that care responsibilities create hardships for 
family caregivers.
    And third, that family caregivers need better support. I 
will elaborate on each of these points in turn.
    Most frail older Americans live at home and rely on unpaid 
help from family and friends. Less than one-seventh of the 
frail older population resided in nursing homes in 2002, and 
only about 14 percent of all frail older adults living outside 
of nursing homes received paid home care. That was generally in 
combination with unpaid help.
    Now older people turn to informal care partly because paid 
services are so expensive. Only about 10 percent of older 
people have private long-term care insurance. Medicaid covers 
paid home care for older people with very limited financial 
resources, but only about one in six frail older adults living 
at home have coverage, though many have little income and few 
assets.
    About 34 million people representing about one in six 
adults provided care in 2004 to Americans ages 50 and older. 
More than half of unpaid caregivers to older people are their 
children or their children-in-law.
    Daughters serve as primary caregivers for about two-thirds 
of widowed older care recipients.
    The benefits of unpaid elder care are substantial. These 
activities enhance the lives of millions of frail adults and 
permit many to live in their own homes instead of in nursing 
homes.
    Frail older adults who receive frequent help from their 
children are about 60 percent less likely to enter nursing 
homes than those who receive less help. And if the adult 
children who help their frail parents were paid the average 
hourly wage that nursing aides receive, the cost in 2005 would 
total about $46 billion.
    The cost of unpaid help from all family and friends would 
reach $103 billion. That is about half the national spending 
for paid long-term care services. But these important 
activities create significant hardship for family caregivers, 
and that is my second point.
    Care giving takes a lot of time. It typically lasts about 4 
years. Daughters who help their parents average about 134 hours 
of care each month, and those who serve as primary caregivers 
devote about twice that amount.
    Most people providing care to their parents juggle other 
responsibilities. About half are employed full time. Another 10 
percent are employed part time. And more than 1 in 3 caregivers 
to older people have children under age 18.
    Care responsibilities often interfere with paid work. More 
than half of employed caregivers report that their care duties 
sometimes force them to go to work late, to leave early, or to 
take time off.
    My research shows that on average women ages 55 to 67 who 
help their parents cut back their work by nearly 400 hours per 
year, and that is an average annual loss of about $8600.
    Care responsibilities also take emotional and physical 
tolls on caregivers. They exhibit higher levels of depressive 
symptoms and other mental health problems than their peers who 
do not provide care.
    They are less likely to engage in preventive health 
behaviors, and they are more prone to develop serious illness. 
And they exhibit higher mortality rates.
    Now caregiver burdens are likely to worsen in coming 
decades as Baby Boomers age and the number of people with 
disabilities grows. Even if old age disability rates were to 
decline by 10 percent between 2000 and 2040, the number of 
frail older Americans will more than double over that period, 
outpacing the growth in the size of the younger population.
    This brings me to my final point, that family caregivers 
need better support.
    In a recent survey, about two-thirds said they needed more 
help or information. More than one in three said they needed 
help finding more time for themselves, and about as many said 
they needed help balancing work and care and managing emotional 
and physical stress.
    There are few programs that support family caregivers. The 
three primary Federal initiatives for caregivers offer some 
help, but not enough.
    The Family and Medical Leave Act guarantees workers up to 
12 weeks of unpaid leave per year to care for an ill child, 
spouse, or parent, among other things, but most workers simply 
cannot afford to take unpaid leave.
    Medicaid supplies the majority of public funding for home 
and community-based care, but services are available only to 
low-income people. And funding constraints in some States limit 
services even for those who qualify.
    Finally, the National Family Care Givers Support Program 
provides States with funds to support family caregivers helping 
older people. It finances individual counseling and training 
for caregivers, information about community services, and 
respite care that provides temporary relief from care 
obligations. But inadequate funding levels have limited its 
impact. Additional funds for this program would allow local 
governments to provide more supportive services that family 
caregivers need.
    Thank you.
    [The prepared statement of Dr. Johnson appears in the 
Submissions for the Record on page 29.]
    Senator Klobuchar. Thank you, Dr. Johnson.
    Ms. Morris.

STATEMENT OF VIRGINIA MORRIS, AUTHOR OF ``HOW TO CARE FOR AGING 
                PARENTS,'' SAG HARBOR, NEW YORK

    Ms. Morris. Well I am afraid this is going to get a little 
repetitive, but thank you for having me here today.
    This is an incredibly important topic, as clearly all of us 
know. I have my 9-year-old, 13-year-old here, and my 81-year-
old mother at home.
    Although caring for our elders is an age-old practice--it 
has been done throughout history in every culture--what we are 
encountering today is a new phenomena. Not only are people 
living longer, but they are living for years with multiple and 
severe illnesses.
    They do not need just warm meals and a loving hug; they 
need someone to manage medications, wounds, catheters, and 
oxygen tanks. They need someone to feed them, to get them on 
the toilet, to pull on their socks, and to remind them what day 
it is. And they need someone who can make sense of a maze of 
services, insurance forms, bills, and health plans.
    The caregiver side of this equation has also changed. As 
you have heard already, caregivers often live apart and women, 
the traditional caregivers, are working and having children 
later. In other words, just as the needs of the elderly has 
grown, the availability of their caregivers has diminished.
    Still, more than 80 percent of the care provided to the 
elderly in this country comes from family members. The value of 
that care has been estimated at about $300 billion a year, but 
I would argue that it is priceless.
    While care giving certainly has its rewards, it also takes 
an enormous toll as you have already heard, and families are 
bending under the strain. The average caregiver spends more 
than 20 hours a week at this task, but many live and breathe it 
unable to leave Dad alone for 1 minute.
    About a fifth of caregivers devote 40 hours a week or more 
to an elderly person's care. The job typically lasts between 5 
and 7 years.
    It is not simply time-consuming, it is emotionally 
draining. Care givers are confused, guilt-ridden, overwhelmed; 
they are grieving; they are isolated; they are exhausted.
    Many caregivers--as you say, the sandwich generation--are 
pulled between aging parents and young children. About 40 
percent of caregivers have children under the age of 18 living 
at home.
    Families are torn apart as the demands of care giving leave 
children neglected and marriages divided. I am sorry to paint 
such a bleak picture, but I am afraid it gets worse.
    Half of all caregivers also work. Unable to juggle 
children, care giving, and careers, some quit their jobs. More 
than half cut back their hours or otherwise adjust their work 
days. They lose income and give up chances for bonuses and 
promotions.
    While at work they are distracted and preoccupied. I had an 
estimate of $34 billion a year, but you say $46 billion a year; 
whatever, it is huge.
    So what is a working caregiver to do? Put Mom in a nursing 
home? Mom certainly does not want that, nor do other family 
members.
    Furthermore, the average cost of nursing home care is more 
than $70,000 a year. In some areas like New York City, it is 
$140,000 a year. That is the average, and that does not include 
medications or rehabilitative therapy.
    Assisted living care and in-home care, professional in-home 
care are usually less expensive, but still out of reach for 
many families.
    Those on one end of the financial spectrum can afford long-
term care. Those on the other end quickly land in the safety 
net of Medicaid. But the vast majority of families reside in a 
gap.
    They have faithfully paid their mortgages and put aside a 
reasonable nest egg, only to find their savings decimated and 
their loved ones without adequate care. Let me paint a quick 
picture for you--and you have your own pictures.
    Ann's father lives with her. He has mild dementia. He 
recently lost his eyesight. He started to hallucinate. He needs 
someone with him at all times. Ann, who has a 15-year-old 
daughter, cannot afford to quit her job, but hiring someone to 
stay with her father during the day will cost her $50,000, much 
more than she earns.
    There is no adult day care program in her community. For 
now, she has glued together a patchwork of friends, volunteers, 
and paid helpers, but it will not last. She is frazzled and 
frightened. She does not want to put her father in a nursing 
home, and she does not know what to do or where to turn.
    Some 50 million Americans now care for elderly family 
members. As a society, we need them to do this job. We want 
them to stay at it. It is better for the elderly person, 
without question, to be cared for at home. And obviously we do 
not want a significant proportion of our elderly living in 
institutions and supported by Medicaid.
    But the weight of this task often leaves caregivers 
clinically depressed, physically sick, divorced, unemployed, or 
impoverished. With nowhere to turn, they finally have no other 
choice but to put Dad in a nursing home.
    To care for our seniors, to keep them out of institutions--
which are both expensive and inadequate--we must care for 
family caregivers. I do not think we need studies to tell us--
although there are dozens of them--that caregivers who have 
support, who have access to services, and who take breaks, take 
better care of their elderly family members, stay on this task 
for a longer period of time, and keep their loved ones out of 
institutions. These caregivers are also less apt to become sick 
and financially troubled. So the premise is a simple one. If we 
support caregivers up front, we will save money and lives 
further down the road.
    Policy is not my specialty, but I can tell you that no one 
approach will solve this problem. We need to attack it on many 
fronts, and we need different strategies for different 
communities.
    Businesses need to do much more to support their caregiving 
employees. Services such as respite, day-care, companions, home 
makers, handymen, support groups, meal, transportation, and 
delivery services, are all sorely needed, particularly in 
remote and underserved areas.
    We also need early intervention in order to assist 
caregivers before they burn out. We need programs like some of 
these new collaborative programs that get doctors connected 
with Area Agencies on Aging so that they can identify 
caregivers early on and start an assessment to help them before 
they are frazzled.
    People need help navigating the current system, which is 
impossibly fragmented and complicated. We need assessments of 
caregivers and the elderly as a holistic group somewhat in the 
way Hospice looks at a client. They look at the whole family 
group, not just the elderly person.
    We need volunteer initiatives that put both young people 
and older people to work caring for those in their community. 
We need inter-generational programs that do not sequester the 
elderly--which I find to be a very dangerous thing to do.
    In closing, I would like to remind you that there are some 
78 million Baby Boomers who are now moving into their 50s and 
60s, which means that their parents are between 70 and 95. 
Elder care is upon us.
    Thank you, very much.
    [The prepared statement of Ms. Morris appears in the 
Submissions for the Record on page 34.]
    Senator Klobuchar. Thank you.
    Ms. Wilcox.

STATEMENT OF LENI WILCOX, DIVISION DIRECTOR, COMMUNITY SERVICES 
   FOR THE ELDERLY, AMHERST H. WILDER FOUNDATION, ST. PAUL, 
                           MINNESOTA

    Ms. Wilcox. Yes. I think the themes you are going to hear 
are very similar through all of our testimonies.
    Good morning, Chairman Klobuchar and distinguished Members 
of the Joint Economic Committee. Thank you, Chairman Klobuchar 
for bringing this critical issue before the Committee and 
inviting our testimony.
    As Chairman Klobuchar mentioned, I am Division Director of 
Amherst H. Wilder Foundation's Community Services for the 
Elderly. We serve about 2,000 low-income and older and disabled 
adults and their family caregivers each year in the St. Paul, 
Minnesota, area.
    We also partner with three other area nonprofit 
organizations to offer one-stop access to care coordination and 
our caregiver coaching service, a national award winner of the 
2006 Family Caregiving Award.
    This partnership, called Eldercare Partners, is funded by 
the National Family Caregivers Support Program through our 
Metropolitan Area Agency on Aging, and it allows us to assist 
about 400 family caregivers each year, helping them to do one 
of life's toughest jobs.
    Our caregiver coaches assess caregivers' needs in depth, 
then help them navigate the service system, provide family 
mediation if it is needed, and then build an ongoing 
relationship to help them build the skills, confidence, and 
resilience they need to do their job.
    We see two kinds of caregivers. First, we find those with 
mastery who have learned how to cope, who know when to ask for 
help and where to find it. And then we also see those who are 
physically overwhelmed, financially stressed, and emotionally 
almost out of control.
    Too often if these caregivers do not receive some support, 
they give up, leading to much lower quality of life for the 
care recipient, but also for society--as other testifiers have 
said--through higher expenditures for institutional long-term 
care.
    I would like to give an example here of how our caregiving 
service works. Alice is a caregiver and her father is an 80-
year-old polio survivor now living with congestive heart 
failure, kidney disease, and depression.
    Alice left her full-time job to provide the assistance and 
the 24-hour supervision he needs. She is paid as a personal 
care attendant for some of her caregiving hours, but her income 
has decreased dramatically.
    She struggles to find time for the rest of her family and 
worries about neglecting her own health. The Eldercare Partners 
coach that works with Alice helped her to find a mental health 
consultant for her father, a Rabbi who will visit him at home, 
and, for her, a volunteer to provide some respite so she can 
get away for short hours.
    And the coach also works with Alice on setting and pursuing 
her own wellness goals. Alice proudly announced last week to 
her caregiver coach that she recently spent an hour in the park 
with her dog. This was a wonderful moment for this caregiver.
    Caregiving is a core social value in America, regardless of 
income, cultural background, or geographic region. Most 
caregivers are unsung heroes who find great personal 
satisfaction without asking for recognition or thanks.
    Their role is not an easy one, and services like ours help 
them juggle work, raise children, and care for their parents. 
As we have all stated, supporting caregivers is critical for 
America's future.
    As Senator Klobuchar stated, as our Nation ages health and 
long-term care costs are projected to increase dramatically, 
and support for caregivers will be even more important in 
helping older adults remain in their homes as long as possible, 
where they want to be, and in community settings which is much 
more cost effective than institutional, long-term care.
    And the economic impact of caregiving is substantial and 
longitudinal. High caregiver stress is associated with 
premature, costly, nursing home admission, and can negatively 
impact the caregiver's income, employment, future retirement 
security, and even their future health care costs.
    Service awareness, access, and navigation are our greatest 
challenges. The services and financing that support long-term 
care are chaotic, fragmented, and intimidating for all of us, 
including me, who is in the business.
    There is not a level playing field of supportive services 
available, with great variation among States and between 
metropolitan and rural areas. Although mainstream media 
coverage has certainly increased about Boomers caring for their 
parents, there is a great need for a lot more public education 
to make people aware that they can get support and help to 
navigate our disjointed system.
    Caregivers are the heart of our long-term care system, and 
we must do more to address their emotional, physical, and 
financial challenges. Shifting the focus on and funding of 
long-term care to community services is essential.
    Also, the National Family Caregiver Support Program was a 
significant first step in bringing resources and attention to 
caregiver needs. But public understanding still remains low. 
Service availability is uneven. And access is difficult.
    You can help by keeping this issue alive in public 
discourse, strengthening access points and navigation 
assistance, and allowing flexibility in service design so 
caregivers have options for their unique circumstances. We all 
need caregivers. They need our help.
    Thank you for your attention to this important and growing 
national issue.
    [The prepared statement of Ms. Wilcox appears in the 
Submissions for the Record on page 40.]
    Senator Klobuchar. Thank you, Ms. Wilcox.
    Mr. Weisberg.

 STATEMENT OF SCOTT A. WEISBERG, VICE PRESIDENT, COMPENSATION, 
   BENEFITS AND STAFFING, GENERAL MILLS, INC., MINNEAPOLIS, 
                           MINNESOTA

    Mr. Weisberg. Well thank you, Senator Klobuchar, and thank 
you to the Members of the Joint Economic Committee for allowing 
General Mills to be here.
    My name is Scott Weisberg, and my role at General Mills is 
as vice president of Compensation, Benefits and Staffing. 
General Mills has about 28,000 employees worldwide, and about 
18,000 in the United States. About 5,000 in my adopted home 
State of Minnesota, and about 1,000 in my home State of 
California.
    What I would like to talk about briefly today is a little 
bit different from the other panelists. I would like to talk 
about why elder care is important to General Mills, and 
probably by extension to all employers.
    First and foremost, the way to understand this issue is 
that we are in a battle for talent day in and day out. That is 
where most of my time is consumed. So what I am thinking about 
is our employee value proposition. In fact, McKinsey did a 
study not too long ago and they characterized that as the 
Boomers exit the work place, there is going to be a War for 
Talent.
    We are unique as employers go today, we think, because we 
still are one of the 18 percent of private employers that still 
offer a Defined Benefit Pension Program. We offer a 401K 
Program that has a company match that varies based on the 
corporation's performance. And we still offer Retiree Health 
Care.
    So in those ways we are unique. But even with that, we are 
finding that it is harder and harder to recruit and retain the 
talent that we want. In the past, we found the campus recruits 
who we were trying to hire were receiving two additional offers 
to the offers that we were providing. We are now finding, on 
average, that we they are receiving five. And in the future we 
think that they are going to get seven to nine.
    So it is tougher to recruit people. And executive 
recruiters who know that we are recruiting folks, we are 
developing folks, are coming after those we have recruited and 
trying to hire them away. So it behooves us to work on policies 
to make sure that we retain our employees, as well as hire and 
develop them.
    So to do this, we found that one of the greatest things 
that we can do is to provide work life programs and policies 
that offer support, and we do that in three ways.
    The first way is through financial support and expert 
advice. The primary way that we do that is to provide services 
like an Employee Assistance Program. We have offered an 
Employee Assistance Program for over 20 years to our employees 
where they can use the Internet and a toll-free 1-800 number to 
get advice on any number of things, including elder care.
    But specifically, as it relates to elder care, our 
employees can call to get information around how to cope with 
the aging process, how to communicate and help their parents 
understand the Medicare and Medicaid system. They have access 
to a data base of over 100,000 elder care providers.
    There are personalized searches that can be conducted to 
help the employees find adult day services and in-home 
services, and conduct assessments in-home for their parents, as 
well as provide transportation services and retirement 
communities and nursing homes.
    In addition, there is training that is provided to 
employees; that if they reach out and get it, they can either 
do it on line or there is other training available to help them 
plan and anticipate their own unique situations as it relates 
to elder care.
    In addition, we offer long-term care insurance that can be 
purchased through our Employee Benefits Program. We find that 
with the purchasing leverage of General Mills and by helping 
our employees with finding a skilled provider, it is very 
helpful to them.
    Second and most importantly is time. We are finding that 
the one thing that employees need more than ever before is 
time. Often when caring for an aging parent, the most important 
support that can be provided is just being there, whether it is 
for appointments, or to discuss a sensitive issue.
    And so we have got competitive superior paid time off 
policies, whether it be 3 weeks to 5 weeks of paid vacation, 
flexibility through part-time employment, job sharing and 
flexible hours, paid maternity/paternity/and adoption leave, as 
well as summer hours, which is an important benefit in the 
summer, which is a compressed work week so that employees can 
take Friday afternoons off.
    In addition, we have added flexibility through up to 2 
weeks of additional flexible vacation time a year, and 
sabbaticals of 4 to 12 weeks a year if you have been with the 
company for more than 7 years.
    But we all know that even with these policies and programs, 
and time off; these programs will fail if you do not have 
managers that support it. I will tell you that--and it sounds 
like my story is not unique--but I had my own version of the 
sandwich generation about 6 years ago.
    We were at a critical time in our corporate history as we 
were going through the acquisition and integration of 
Pillsbury. As you can imagine, that is a pretty busy time for 
an HR guy. My son was about 15 months old at the time, and my 
father, who lived 1500 miles away in California, was diagnosed 
with cancer.
    I moved him from California to Minnesota for the last 6 
months of his life, and the EAP provided me with terrific 
advice in terms of where to go for his care. We have an in-
house doctor who helped me kind of navigate the system of 
medical care and make sure that I was asking the right 
questions of his doctors and eventually to get him into the 
right place before he passed away.
    So as we look forward, we are concerned with two issues. 
The first is: How do we help our employees in terms of 
flexibility as they care for their elderly parents?
    Then also as employees are going through the aging process 
themselves and they are more and more concerned with the right 
kind of resources for retirement, how can we support them with 
their own transitions as they age and take care of their 
parents?
    So thank you very much for the time to talk today, and I am 
interested in the Q and A.
    [The prepared statement of Mr. Weisberg appears in the 
Submissions for the Record on page 43.]
    Senator Klobuchar. Thank you very much, Mr. Weisberg. We 
have our official Chairman, Senator Schumer, here today who was 
gracious enough to let me Chair this, and he has a lot to do 
today, but he came by to join us for a few minutes.
    Thank you, Senator Schumer.

  OPENING STATEMENT OF HON. CHARLES SCHUMER, CHAIRMAN, A U.S. 
                     SENATOR FROM NEW YORK

    Chairman Schumer. Well thank you, Senator Klobuchar. This 
may be the first hearing you are chairing, but it will not be 
the last, I assure you of that, either on this Committee or on 
many other august places in this United States Senate. Senator 
Klobuchar just does an incredible job on so many of the issues 
that matter to average folks.
    One of the great things about our new freshman class here 
is that they are in touch with what people really want, and 
that is how our system gets infused with new vitality.
    I would also like to welcome my constituent, Ms. Morris, 
for coming and thank you for writing a great book, which we 
appreciate.
    Now it is very important that we hold this hearing because 
there are new problems in America. Technology has changed our 
world. It has created terrorism. Small groups of bad people can 
hurt us. It has created globalization, but one of the things 
that people forget about--which may be more profound than the 
other two, at least to families every day--is we live a lot 
longer. The average life expectancy continues to climb and 
climb and climb.
    I read somewhere that a little girl born today, if she 
lives to her first year, because there are diseases at birth, 
is likely by the time she is 50 to have a life expectancy of 
100. They will expect her to live to 100. It is a little less 
for men who are not as strong a sex as women.
    This is an amazing thing. It changes everything in our 
lives--everything, everything, everything. I remember when 
Willard Scott, when I first started watching the Today Show, 
would read birthdays and 85 was an old, old birthday, a rare 
thing. I think, when he quit he was reading them at 102, or 
103, and it shows you again how society has progressed. And 
with people living longer, elder care is so, so important, more 
important than ever.
    It is probably one of those issues that average families 
when they sit around the dinner table Friday night think about 
a lot more than many of the things we talk about here. So it is 
prescient of Senator Klobuchar to lead this hearing and suggest 
that we have this hearing.
    We have to figure out, as you talked about, Mr. Weisberg, 
in your own personal life, how average families can balance 
work and taking care of their own children, struggling to save 
for their own retirements, and then deal with their parents, as 
well. It is a phenomena that we have to pay a lot of attention 
to.
    I do not want to read my entire statement. I will make a 
couple of points. I do not know if they were made.
    First, help for the elderly from friends and family is 
valued at about $100 billion a year, and it is growing. That is 
a huge number. Most things that take $100 billion in our 
society we pay more attention to than this one.
    It is more than Medicaid. It is 2\1/2\ times Medicare. We 
pay a lot of attention to Medicare, and we should, but what 
about paying attention to this issue.
    It is going to get even more difficult because people are 
getting older. Baby Boomers have fewer children. The overall 
labor force relative to the elderly population will shrink, and 
also because, as you all point out, the old idea of families 
living near one another is gone.
    It used to be that there was a whole network of relatives. 
So when someone elderly became sick, their kids, their nieces 
and nephews, their brothers and sisters, would care for them. 
That is a more rare thing now with our vastly mobile society.
    So basically the kinds of policies that we design have not 
caught up with these new realities. One of our jobs at the 
Joint Economic Committee, which Senator Klobuchar is so ably 
leading us on here, is to figure out not the specific policy 
recommendations--those are in the substantive committees--but 
to lay out a problem and point to the general direction in 
which we must move, and we hope this hearing will really be 
groundbreaking in that regard.
    So I thank all of you for being here. I thank my 
colleagues, and on with the questions.
    [The prepared statement of Senator Schumer appears in the 
Submissions for the Record on page 26.]
    Senator Klobuchar. Thank you, Senator Schumer.
    Senator Casey.

OPENING STATEMENT OF HON. ROBERT P. CASEY, JR., A U.S. SENATOR 
                       FROM PENNSYLVANIA

    Senator Casey. Thank you, very much.
    I first of all want to thank Senator Schumer for allowing 
us to have hearings like this, and for Senator Klobuchar to act 
as the Chair of this hearing.
    I am struck by a number of things, not just how important 
this issue is, but this is kind of inside baseball--I thought 
it would take Senator Klobuchar at least a year to become a 
committee Chair.
    [Laughter.]
    Senator Casey. Most Senators in Washington, it takes 25 or 
30 years--
    Senator Klobuchar. All right--
    Senator Casey. But she did it in 5 months.
    Senator Klobuchar. It is one hearing.
    [Laughter.]
    Senator Casey. She is always ahead of the rest of us. But 
seriously, though, we are truly honored to be part of this.
    With the Chairman and Chairwoman's consent, I will submit 
my full statement for the record, without objection.
    I did want to note a couple of things, because we want to 
get to questions. One is, the significance of this issue for a 
State like Pennsylvania. Our State is second only to Florida in 
the percent over 65. We have approaching 16 percent over 65. 
But the fastest growing segment of our population, not just our 
over-65 population, but the entire State, the fastest growing 
segment is 85-and-up.
    So this issue is going to become more and more of a 
challenge for our State, not to mention the States of 
Minnesota, New York, and so many others represented here today, 
California and others.
    So it is a tremendous demographic reality that we face. But 
also I think we all understand the human dimension to this. We 
describe it as the sandwich generation, and we all understand 
this, we just are not sure how to deal with it sometimes.
    But the confluence, or really the conflict between all of 
the emotion that is tied up in caring for an elderly relative, 
especially a parent, bumping up against the obligation people 
have to their workplace, to their children, and to their more 
immediate family, so to speak. So it is a tremendous human 
and--as others have pointed out in their testimony--emotional 
drain on people, not to mention the financial drain that you 
have all highlighted.
    I think that for me this issue, the solution, I guess, or 
one of the solutions to this issue is the caregiver programs 
that we have talked about, and now we have at the Federal 
level.
    Some of that started in Pennsylvania when my father was 
serving as Governor. He created, I think, the first, or one of 
the first family caregiver support programs. His Secretary of 
Aging, Dr. Linda Rhodes, was a real pioneer in this area. So I 
was thinking of her today and him when they did this then or 
more like 15 years ago, almost 20 years ago, just the littlest 
thing of providing a benefit, or I should say providing an 
opportunity for someone to have some free time after laboring 
under the burden of caregiving.
    So it is critically important. It is not just another 
hearing; this is an issue that touches so many lives in 
America, and you know the numbers better than I do, the 
millions and millions that are--tens of millions affected by 
this.
    So we are grateful for this opportunity, and I want to 
thank Senator Klobuchar for giving us this opportunity to 
really focus on this issue.
    Thank you.
    [The prepared statement of Senator Casey appears in the 
Submissions for the Record on page 28.]
    Senator Klobuchar. Thank you very much.
    I have a few questions and, Senator Casey, if you have 
some, too--
    Senator Casey. Sure.
    Senator Klobuchar [continuing]. That would be great.
    First, Ms. Morris, you talked in your testimony about how 
complicated the system can be for families to navigate as they 
look for elder care. This is a complaint I have heard all over 
my State.
    Do you have any ideas for us as Federal policy makers of 
how we can make this simpler for people?
    Ms. Morris. It is so complicated. I have actually been 
involved in this subject since 1991 and I was helping someone 
just this week locate services in our area, and I could not 
even begin to do it. And I am the expert.
    I think coordinating services through the Area Agencies on 
Aging is critical. Some of them are very good at it, but there 
are many of them that you call and they do not even know about 
what exists, and what services and programs are.
    Having one phone number that takes you to one place that 
represents your neighborhood that can tell you about all the 
programs in that neighborhood, financial and care and day care 
and, you know, all the services, would be a huge step.
    I do not know if it is just a matter of training those 
people better to know what those services are--and it is hard, 
because they are changing. Fortunately, there are a lot of new 
services out there, and new programs. If those people were 
better trained to guide you, and if that was accessible on the 
Internet--which more and more people, and even the elderly, are 
using--so that you can just go to Sag Harbor, New York, and 
see: Oh, here are all the services. Here are the programs. Here 
is the support. One place, rather than having to go to 15 would 
be extremely helpful.
    Senator Klobuchar. It sounds like Mr. Weisberg is doing it 
on a company basis, which I think is a very good idea. But the 
other thing you would like to see, as you pointed out, is some 
models for counties, or areas of the country where they are 
making that publicly available.
    Maybe, Ms. Wilcox, you would want to comment about that.
    Ms. Wilcox. Yes. In Minnesota we have the Senior Linkage 
Line, which is a pretty good vehicle for just getting 
information. But my concern is that some caregivers do very 
well with just information, but there are a lot of caregivers 
frankly who do not even know what questions to ask.
    I think there needs to be some deeper drilling down and 
some assistance by professionals with assessment of the 
situation and help for caregivers to really navigate and figure 
out what are the things that they need before they even go out 
and look.
    In Minnesota I know that we are starting to talk about 
caregiver resource centers that are more regional. I think 
there is some discussion about whether those resources should 
be State-funded, whether there would be Federal dollars coming 
through, whether they are the Area Agencies on Aging, or 
whether they are grants to private nonprofit organizations to 
fill that kind of role, but I think there is a common consensus 
that there is some need to have some sort of more indepth 
resources for caregivers.
    Ms. Morris. Can I make one other comment?
    Senator Klobuchar. Ms. Morris.
    Ms. Morris. You bring something up that is very important. 
Many caregivers do not identify themselves as a ``caregiver.'' 
When they try to do studies, people think, ``Well, I am just 
taking care of Mom. I am being me. I am a daughter. It is not 
that I have a title.'' It does not occur to them that there are 
programs out there.
    I think there are some new services and new States looking 
at the idea of having doctors, who are really in the position 
to see the elderly and to see other family members, to say, 
``Do you have an elderly parent? Are you caring for them? Do 
you know that there are services?'' This starts them on that 
path.
    What I have found is, if people get in touch with services 
way before they need them or, when they need them, but do not 
think they need them, they will do much better. Most caregivers 
end up at the door of a day care center, completely frazzled, 
barely functional.
    It has been a long road by the time they have gotten to 
that place. If we could get them into these programs sooner and 
give them support sooner, they would last much longer.
    Senator Klobuchar. Thank you. Dr. Johnson, you have talked 
about how about 10 percent--I think that is where I got that 
figure--of elderly adults have private long-term care 
insurance, including about 7 percent of the frail elderly 
living at home.
    You talked in at least your written testimony about how the 
high premiums account for part of why we are seeing less people 
on this kind of insurance.
    What kind of things do you think need to be done to address 
this issue, and to extend the availability of long-term care?
    Dr. Johnson. I think there is a real question about how 
well the private market can respond to this issue. Can private 
long-term care insurance really ever be the answer to this?
    And I guess I am somewhat skeptical. Part of the reason is 
that long-term care insurance works best when people buy it at 
a very young age. That is when the premiums are low. So if you 
start when you are 40, and then you make payments all your life 
until you die, or until you really start needing long-term 
care, then you can build up this reserve basically that can 
cover your future long-term care costs.
    The problem is that a lot of people in their forties, and 
even their fifties, really are not thinking that they are ever 
going to need long-term care. I think it is really hard to kind 
of get over that initial reluctance to, when you are young, to 
confront the issue that you are going to need long-term care 
insurance.
    And then there is the issue of, well, if you start, if you 
actually do purchase it in your forties, and then you let the 
policy lapse, it really does you no good at all. So it makes a 
rather unique kind of financial instrument.
    Unlike regular insurance where you buy it today, there is a 
good possibility you will end up benefitting from it today or 
tomorrow or in the near future, with long-term care insurance 
that is really very different.
    And another concern with long-term care insurance is the 
cost of living escalators, and exactly how that works. Most of 
these plans work in that you're buying a certain daily benefit 
for some time in the future.
    So let's say you are buying a $150 daily benefit, and then 
you can buy a policy where that benefit will grow let's say by 
5 percent a year. But then you have to make a decision, well, 
do you want it to grow at a simple 5 percent? Do you want to 
compound at 5 percent?
    So the individual is the one who has to forecast the future 
growth of long-term care costs, and that is really hard. So if 
you are in this plan that maybe has a 5, or a 3 percent 
inflation protection, but the costs actually increase by 7 
percent over 30 years, that really reduces the real benefit of 
the protection you have and can really erode--can really I 
think make the policy less than ideal.
    Senator Klobuchar. Thank you. I am going to let Senator 
Casey ask a few questions, because we may have to go vote soon 
and I want to give him that opportunity, although I have many 
more to ask.
    Senator Casey.
    Senator Casey. Thank you, Senator.
    One question I wanted to ask the whole panel, and we 
appreciate the expertise that you bring to this, is a really 
basic question, part of which or maybe most of which you have 
covered in your opening--I was at a Banking Committee hearing 
and had to vote, so I missed half of the testimony--but it is 
fundamentally this:
    We are talking about this as a challenge, and a lot of you 
have proposed ideas about how to solve it or begin to move in 
the right direction. What is the current state of Federal 
policy in terms of what the Federal Government is doing now?
    I guess I would ask a three-part question:
    What are we doing now in the Federal Government?
    How is it working?
    And if the answer to number two is ``not well,'' then what 
do we need to do next?
    I just want to get kind of an overall sense of the Federal 
strategy right now. Anyone can start. Doctor, if you want to--
    Dr. Johnson. Sure. Basically at the Federal level there are 
three primary initiatives. One is the Family and Medical Leave 
Act, which simply requires employers to provide unpaid leave to 
caregivers.
    Senator Casey. Right.
    Dr. Johnson. Basically there are two limitations. One is 
that it is unpaid leave. So most caregivers just cannot afford 
to stop working.
    And the other thing is, it does not cover all employees, it 
only covers those working for firms with more than 50 
employees, and it only covers people who have worked for a full 
year.
    The other initiative of course is Medicaid is important. 
The focus there is on the care recipient, not the caregiver, 
but by providing paid services to the care recipient that 
certainly helps the caregiver a lot. There of course it is only 
to very low income people, and a lot of people really just fall 
through that safety net.
    And then we have the National Family Caregiver Support 
Program. This provides monies to the States to provide the 
respite care, to provide information and counseling and 
training to caregivers. I think the evidence there is that the 
program has worked pretty well. It was started in 2000, and 
with the introduction of this plan, you did see 18 States that 
really had no types of services at all create these services.
    Now these services exist in all the States. I think the 
problem there is that the program is really only funded at 
about $150 million a year. It is really a tiny program. And it 
is something that I would think could be expanded and could 
have a big impact.
    What I think is nice about that plan is that it gives the 
monies to the States and to localities and lets them tell of 
the programs that they think work the best.
    I do not need to remind you of the fiscal pressures that 
the Federal Government is under, but I do think this is 
something that could actually in the long run save money by 
keeping people out of expensive nursing homes. So this is maybe 
one program--I mean, a lot of people claim that this program is 
worth investing in and is going to save money in the long run, 
but I think this is something that would not be as expensive as 
the actual dollars that are paid out.
    Senator Klobuchar. To follow up, Dr. Johnson, some examples 
from some States might be helpful to prove that point. I think 
intuitively you are completely correct, in saying that if we 
can provide this information, people can stay in their homes 
longer by having assistance with grocery shopping or whatever 
they need, instead of going to a nursing home. It is going to 
be better off for families and for taxpayers.
    I think showing that kind of information, which I am sure 
is very hard to calculate, would be very helpful to put a cost/
benefit on it so we could take that and notch it up some.
    Dr. Johnson. Right.
    Senator Casey. You are basically talking about three 
programs, so to speak: Family and Medical Leave, Medicaid, but 
the one that has the most direct impact on this program in 
terms of focusing on the challenge itself is the Care Givers 
Support Program. Am I right?
    Dr. Johnson. Yes. In my opinion, yes.
    Senator Casey. And I realize that that is underfunded. We 
have the same problem in Pennsylvania, a great program that 
started out I guess 15 years ago is getting progressively more 
money, but never enough.
    Maybe you have already done this, and maybe others have 
done this, but if you are able to--if you cannot do it now, if 
you could supplement the record later--in terms of a concrete 
proposal as to funding.
    Sometimes when you have a program that is small that people 
want to expand, the Washington terminology is ``bring it to 
scale.'' That sometimes sends people running for the hills 
because you get pretty scared about big numbers, but I 
certainly--and I am sure Senator Klobuchar wants to figure out 
a way to get this program expanded, but we need some guidance 
about how to do that in terms of what the need is. But I think 
it is critically important.
    I do not know if the other three witnesses want to weigh in 
on that question before I--
    Ms. Wilcox. Leni Wilcox. One other thing that our Care 
Coordinators talk about is that within the family caregiver 
support program there--there is some inflexibility in the 
service categories.
    I think they would like to see the design become a little 
more flexible. One of the things that they talked about was the 
fact that there is a growing opportunity for technology, things 
like cameras, and cell phones, and things that really can aid 
caregivers, but they are not services that are currently 
covered under that program.
    So there may be some thought about just more flexibility.
    Senator Casey. That's great.
    Mr. Weisberg. On flexibility, I would just add one more 
point. One way to look at this is, what do you do to help the 
caregivers? The other way to look at this is: How do you keep 
people productive longer so that they're either supporting 
their elderly, or being independent themselves longer?
    One thing that we would like to see happen is that there is 
a lack of flexibility around pension legislation, in that if 
somebody wants to start drawing on their pension from General 
Mills and at the same time work, what they need to do is 
terminate from General Mills and go work somewhere else.
    Ironically, if they want to work part-time for us, they 
cannot start drawing on their pension on a partial draw-down of 
the pension.
    So I think that some kind of flexibility there would be 
helpful, because they would likely be making more working for 
the employer that they earned their pension with, and at the 
same time we would obviously benefit as an employer, but I 
think the employee benefits as well.
    And as has been stated already, many of the caregivers are 
working part-time anyway. So if we can keep people working into 
their late sixties, seventies, or even longer, I think that 
would be helpful.
    Senator Casey. I will try to come back, but I want to stay 
within my time.
    Senator Klobuchar. Does anyone else want to comment?
    Ms. Morris. I was just going to say, on the flexibility 
issue and the National Family Care Givers Support Program, some 
of the initiatives some of the States are undertaking have 
consumer-directed programs where, instead of, ``OK you get this 
care from this agency at this time,'' families get some sort of 
voucher system and they can use that to hire a family member, 
or their own choice of caregiver, or they can use it for 
respite: They have an option of how this money will best serve 
them.
    I have been reading some of the early reports on that, and 
it is actually turning out to be very successful. Care givers 
are much more satisfied, without spending more, but just giving 
them options of how to use those funds. And I think 
Pennsylvania may even have one of these and has been a 
forerunner on this front.
    Senator Casey. Right.
    Ms. Morris. I actually have a report from several groups 
that goes through some of these programs, which I can submit 
afterward.
    Senator Klobuchar. OK.
    Senator Casey. That would be great. Thank you.
    Ms. Morris. I found it very interesting. **
    [The report entitled, ``Ahead of the Curve: Emerging Trends 
and Practices in Family Caregiver Support,'' can be found at
http://www.aarp.org/research/longtermcare/resources/2006_09_
caregiver.html]
    Senator Klobuchar. Mr. Weisberg, you talked about how 
General Mills made this decision to go beyond the Family 
Medical Leave Act with your employees. Could you talk a little 
bit about how you made that decision with the cost/benefits? 
That might be helpful for other businesses as they look at 
this.
    Mr. Weisberg. I think what we step back and looked at is 
people were going to leave anyway, and oftentimes the costs, 
the tax that you face as an employer is through turnover. Our 
annual turnover is right around 6 or 7 percent, but they 
estimate that it is about 2 to 3 months worth of someone's base 
salary if someone leaves the door, or walks through the door 
and exits the company, in just that time between lost 
productivity and rehiring somebody.
    So in the long run, we think that it makes more sense to 
provide the support for folks.
    The other thing is, as I have stated earlier, we really do 
try to be kind of a cradle-to-grave employer. If you are going 
to employ people for the long haul, you know that people are 
going to have life happen to them.
    Good employees are going to figure out solutions. We try to 
create alternatives to support them so that they can find those 
alternatives for themselves.
    But interestingly enough, when I was preparing for this 
hearing, I looked into the utilization. And we saw that about 
15 to 20 percent of our folks use the EAP, our Employee 
Assistance Program, and elder care is probably fifth or sixth 
on the list of the reasons why people reach out.
    But as I have heard in the other experts' testimony today, 
many times when you are dealing with elderly care issues, 
people just need time and they are trying to solve it 
themselves.
    So what we are trying to do is provide the support so that 
they can provide that care. And at the same time, we think that 
the productivity or the return is found in our retention 
numbers rather than in the costs for the programming.
    Senator Klobuchar. That makes sense.
    Ms. Wilcox, could you just give me some examples of the 
kind of things that you do? I mean, I saw the work you are 
doing in the Southern suburbs in Minnesota. Talk a little bit 
about, for someone who needs different levels of care, and what 
kind of things you provide?
    Ms. Wilcox. Well, the Wilder Foundation, actually we 
provide the respite through our Day Care Programs as well. I 
think there are many components to providing this kind of care, 
but Eldercare Partners actually does provide this indepth 
caregiver coaching, which is really a meeting with the 
caregiver. This is a service that is offered free, but we do 
have a sliding fee scale for the caregiver. We are able to do 
that through our funding.
    We have a combination of funding both from the Family Care 
Giver Support Program but also we do supplement with Foundation 
funding, and with funding from communities, and this sort of 
thing.
    The Caregiver Coaches meet with the caregiver and the 
family. It could be more than one. It could be a family 
dynamic. They do an indepth assessment of the needs of the 
caregiver.
    They take a lot of things into consideration. They work 
with the caregiver to develop a longitudinal plan, and really 
work through teaching them about the service system so that 
they actually can be the navigator.
    Our idea is not to do it for them, but for them to do it 
for themselves. And really to help be there as a support system 
for that person.
    There are a number of circumstances where we do have issues 
that require family mediation which involves family meetings, 
and bringing family members together to deal with difficult 
decisions. That generally brings people to the same page. And 
then we follow that caregiver over time so that they really 
have the confidence as things change to do that proactive 
planning that you talked about, to anticipate.
    So that is the essence of what we do.
    Senator Klobuchar. Very good. Ms. Morris, Mr. Weisberg used 
his example of his father living in California; you have talked 
about the further challenge of Americans becoming increasingly 
geographically dispersed. Could you expand on how this trend is 
affecting the manner in which people are trying to take care of 
their parents and the struggles that they face?
    Ms. Morris. Well, in so many obvious ways because you 
cannot just check in on Mom, or you do not even know what is 
going on with her.
    I have heard dozens of stories, as I am sure everyone on 
this panel has, of people who went home for Christmas and found 
their parent under-fed, and poorly clothed, and living in a 
horrible situation. And they had no idea, just with their phone 
calls, of what was going on.
    It is particularly difficult because people not only live 
far away, but they are working. And so when there is a call 
from the hospital, you cannot just be there. And again, there 
are fragmented services. I am sure with your program it is not 
just what is located locally, but your employees need to know 
what is going on in Florida, and what is going on in Texas.
    So again, it would be great if there were--and there is a 
system--but if there were a little bit better-working system 
where you could call the Area Agency on Aging in your parents' 
community--in Houston when you are in New York--and ask about 
the services, and be in touch with somebody who really can 
navigate that area, because you are so far away. You are really 
dependent on strangers to take care of your parent from a very 
long distance.
    I think that just adds to the frustrations, and the grief, 
and the distractions in trying to get your life together. But 
also you are taking more time away from work. It is not just, 
``I will leave at 3:00.'' It is, ``I am gone for four days.''
    Senator Klobuchar. I also think for the rural areas, in our 
State for instance, where you tend to have an older population. 
Maybe their kids are in the same State, but they are moving 3, 
4, 5 hours away, I imagine that this is going to be part of the 
problem, too.
    Ms. Morris. Well, in rural areas, in general, they just do 
not have the same kinds of services. Living in one myself and 
trying to help people locally, it is very difficult.
    And again, one thing I have heard is that these consumer-
directed programs are very good in rural areas where there 
aren't services and it gives them so much more flexibility in 
getting help.
    Senator Klobuchar. Does anyone want to add to that?
    [No response.]
    Senator Klobuchar. Well, I want to thank everyone. If you 
have any closing comments or things that we have asked about 
that have triggered ideas, you are welcome to do that. We have 
not heard the buzzer go off yet for the vote.
    All right, well thank you so much. I am sure this is the 
beginning of many hearings. I think you saw the interest of my 
colleagues on this issue. I know Senator Mikulski, who heads up 
a committee that focuses on aging issues, is very interested in 
this, and we are going to continue to work together on 
solutions. I think of this as a beginning.
    Thank you very much.
    Ms. Morris. Thank you very much.
    Senator Klobuchar. Now that they have all been commenting 
about this, I will have to end the hearing. The hearing is 
adjourned. Thank you.
    [Whereupon, at 10:40 a.m., the hearing was adjourned.]
                       Submissions for the Record

=======================================================================

[GRAPHIC] [TIFF OMITTED] T6705.001

       Prepared Statement of Senator Charles E. Schumer, Chairman
    I want to thank my colleague, Senator Amy Klobuchar, for taking the 
initiative to hold what we believe to be the first hearing dedicated to 
the issue of eldercare, its impact on the personal finances of middle-
class families and productivity of our nation's businesses.
    We should all recognize that a growing number of American families 
are going through a challenging role reversal--obligated to take care 
of the parents who once cared for them.
    And this obligation is coming at a time when middle-class families 
are walking a tightrope between balancing work and taking care of their 
own children, while struggling to save for their own retirements.
    The statistics are alarming, and will swell dramatically as our 
population ages:
    Today, about 10 million older Americans require some type of in-
home care.
    By 2022, that is, in just 15 years, it's expected that the demand 
for long-term care will have increased by 30 percent. And by 2050, the 
need for long-term care will have doubled.
    Overwhelmingly, the vast majority of aging Americans turn to 
friends and family for help. Help that costs them over $100 billion 
each year and growing--more than Medicaid, and almost 2\1/2\ times more 
than Medicare. That's a staggering number.
    This situation is only going to get worse. Even as the need for 
care explodes, the supply of professional long-term care providers 
won't come close to keeping up. Because baby boomers have had fewer 
children than previous generations, the overall labor force relative to 
the elderly population will shrink, making it even more difficult than 
it is today to attract and retain nursing aides and other long-term 
care workers.
    Families have always cared for the elderly. But as middle-class 
families are finding it more and more difficult to afford the rising 
costs of child care, health care, college and gas prices, the time and 
financial demands of caring for elderly family members can force a 
difficult decision.
    It's estimated that the average caregiver loses more than $650,000 
in lifetime earnings and retirement savings as a direct result of their 
caregiving responsibilities. $650,000!
    This price tag means that more and more families are being forced 
to choose between sacrificing either their own financial security or 
the comfort and care of their elderly loved ones. That is a decision 
that no one should have to make.
    The financial impact of informal elder caregiving doesn't stop with 
the caregivers, but also matters for the economy as a whole. Over one-
third of all workers provide informal eldercare, another number that 
will only grow in the coming decades. To take care of their parents and 
grandparents, American workers end up curtailing their work hours, 
conducting care activities at work, taking unpaid leave, and making 
other adjustments to accommodate their caregiving responsibilities.
    The lost productivity to U.S. business amounts to over $33 billion 
annually. We can't afford to take this hit to our productivity at a 
time when our economic growth is slowing, with more obstacles to come 
from an increasingly competitive global economy.
    The helpers need our help. Without it, more and more families will 
be unable to shoulder the burdens of caregiving. I am looking forward 
to learning from our witnesses today how we can best ease the strain on 
families being ``sandwiched'' by the competing demands of taking care 
of their parents and their children.
                               __________
              Prepared Statement of Senator Amy Klobuchar
    I want to thank Chairman Schumer and Vice-Chairwoman Maloney for 
graciously giving me the opportunity to call this hearing examining the 
economic impact caring for our nation's elderly has on American 
families and businesses.
    As I travel throughout my state, I often hear from middle-class 
families squeezed by the burden of rising health care costs, rising 
child care costs and rising college tuition costs--struggling to do 
right by their families.
    And, increasingly, I hear from families trying to cope with the 
financial, social and emotional burdens of caring for aging or frail 
family members--often, while they are still caring for their own 
children.
    We want to care for and do what's best for our loved ones. But 
modern economic realities make it very hard for so many of our 
families.
    In many respects, this is a success story for our society--so many 
of our seniors are able to enjoy long and fulfilling lives. According 
to the Centers for Disease Control, a baby born today is expected to 
live well into her 80s--almost 35 years longer than a baby born at the 
turn of the 20th Century.
    But as Americans are living longer, their needs for support are 
growing exponentially. Today, almost 10 million Americans--or more than 
one third of the nation's elderly population--need some form of long-
term care.
    While nursing homes and paid care provide supports to our elderly 
in some situations, the vast majority of elder care comes from informal 
caregivers--more than half of whom are adult children taking care of 
their parents.
    Today, our adult daughters and sons are increasingly responsible 
for helping their parents with tasks ranging from the mundane--like 
shopping for groceries and helping with chores around the house--to the 
more intensive--like managing personal finances and helping to make 
major health care decisions.
    And while our adult children want to provide this type of care to 
their parents, they are increasingly feeling overwhelmed.
      They are stressed for time. Care givers today must often 
struggle to balance the competing demands of caring for their parents, 
while meeting their work responsibilities and raising children of their 
own.
      They are emotionally and physically exhausted. Care 
giving is not an easy job. It is not predictable, and it doesn't get 
easier with time. In fact, it often gets much harder as time passes. In 
many situations, caregivers know that their loved ones are not likely 
to live much longer.
      They are frustrated with our fragmented, costly, and 
confusing system of services. Repeatedly, caregivers have told me that 
don't know how to get support, where to turn to help, or even the types 
of services that are available. And their frustration is compounded by 
the fact that care-giving decisions are frequently made in the middle 
of a crisis.
      They are also faced with the financial challenges of 
caring for their aging parents. Almost two-thirds of adult children who 
care for their parents work, and many report that to meet their care 
giving obligations they need to take time off, cut back on hours, or 
turn down opportunities for training or promotion. They do this at the 
same time they are trying to make ends meet, save for their own 
retirement, and put their children through college. It is therefore not 
surprising that as more families are caring for elderly relatives in 
their later years, more need help with the costs of that care.
    To help ease the burdens of caregivers, our public policies, our 
business practices and our family customs need to keep pace with 
changing demographic realities where care giving responsibilities take 
on ever increasing importance.
    So, one of the things I have proposed is a Federal elder care tax 
credit to help defray some of the costs that families incur as they 
care for an aging or ailing family member. I was pleased to join with 
many of my colleagues on this committee to introduce the Middle Class 
Opportunity Act, which among other things, expands the dependent care 
tax credit to cover expenses incurred by families as they care for an 
aging parent.
    It's a modest proposal, given the magnitude of the burden. But it's 
a start--and it recognizes this ever-growing reality that must be a 
priority for our society and our government.
    I think that there is more that we can do to provide relief to 
caregivers. As we shine a spot light on this issue, which in my 
opinion, has received far too little attention so far, I am hopeful 
that we can explore policy options that can help ease the many burdens 
faced by caregivers. In particular, there are three areas I think we 
should explore:
      First, how we can provide more financial relief to elder 
caregivers;
      Second, what options are available to us to expand 
support services for caregivers and how can we make caregivers aware of 
these services; and
      Third, how can we help caregivers plan for their own long 
term care needs?
    I am pleased to have such a distinguished panel before us today who 
can help us explore how we can address these goals, and how together we 
can move forward to help bring some relief to the backbone of our care 
giving system--American families.
    But before I introduce our panelists, let me first turn to our Vice 
Chair to allow her, and then other members, a chance to provide brief 
statements.
                               __________
           Prepared Statement of Senator Robert P. Casey, Jr.
    JEC Hearing ``Are the Explosive Costs of Elder Care Hurting Family 
Finances and Business Competition?''
    Thank you Senator Klobuchar for your great work on the issue of the 
economic impact of elder care, an issue we are just starting to explore 
and I think we will learn a great deal here this morning from this 
excellent panel of witnesses.
    The so-called sandwich generation, those who care for parents and 
children simultaneously, are indeed under a lot of pressure as more and 
more of our older citizens remain at home and rely upon their adult 
children for care.
    The data shows that over 85 percent of our elderly population lives 
at home. And about one third of these folks need care for such daily 
activities as bathing, eating, household chores, grocery shopping, 
cooking and managing finances. In my State of Pennsylvania, we have 
about 1.9 million older citizens. Of these, approximately 1.6 million 
live at home and roughly 627,000 need help on a daily basis.
    The numbers are growing as our baby boomer population ages. In 
2002, 35 percent of all workers reported providing informal care to a 
relative or in-law 65 or older. Just 6 years earlier, in 1996, only 25 
percent of workers were caring for an aging relative.
    I have no doubt that most caregivers are very willing to care their 
parents or relatives. But the fact remains that there are some serious 
economic consequences that we need to address. Most adult children who 
care for their parents work and over half work full-time. Most of these 
folks report losing out on promotions or other job development 
opportunities and also losing benefits such as contributions to 
employee retirement accounts and even health insurance. One study of 
all family caregivers found that caregivers lost a lifetime estimated 
average of $659,000 in wage and pension wealth.
    There are other broader consequences as well. Without some kind of 
physical and financial support, caregivers may be forced to cut back on 
their work hours, or alternatively, they may have no choice but to 
consider nursing homes or other institutional alternatives. Reliance on 
public programs for these older folks may increase and inevitably, 
their quality of life may suffer.
    I am very interested in looking into our options for helping the 
sandwich generation get some support in juggling these sometimes 
overwhelming responsibilities. Tax credits for caregivers is a policy 
remedy I think we need to seriously consider. I also think that 
expanding the availability of current support services, such as those 
offered through the National Family Caregiver Support Program is a 
promising options. And of course, one thing we need to do as soon as 
possible is organize greater public awareness to caregivers about the 
kinds of services and supports that are available to them in 
communities.
    Caring for our older citizens is a top priority for me. But to 
truly care for them, we have to be sure that their caregivers have the 
support they need to handle the multiple responsibilities they have. I 
look forward to hearing from our experts on how we can best do that.
                               __________
  Prepared Statement of Representative Carolyn B. Maloney, Vice Chair
    Thank you, Chairman Schumer. I want to thank Senator Klobuchar and 
her staff for working with the JEC in putting together this hearing on 
the very important topic of elder care.
    Many families find themselves facing the dual challenges of raising 
their children and caring for their aging parents, while also working. 
We call them the ``sandwich generation'' because they are caught 
between the competing claims on their time, financial resources and 
emotions.
    Most of the elderly in our country live at home and rely on family 
for help with the daily activities that many of us take for granted--
bathing, dressing, eating, doing laundry, and washing dishes. Adult 
children, particularly women, provide most of the unpaid care for their 
elderly parents. It is not always easy to watch your parents age, but 
many adult children provide this essential care so that their parents 
may grow old with dignity in familiar surroundings.
    The majority of these daughters work full-time, but many report 
taking time out of the work force, cutting back on hours, and losing or 
turning down opportunities for training or promotion because of their 
care giving responsibilities. As Dr. Johnson points out in his 
testimony, last year women caregivers forfeited about $8,600 in 
compensation per year, on average, due to reduced work hours. Clearly, 
unpaid care giving has an impact on women's economic security and their 
ability to save for their children's education and their own 
retirement.
    The lack of flexible work schedules can also be hard on caregivers. 
More and more businesses are finding that, as Mr. Weisberg will tell 
us, in the so-called ``war for talent'' employers must adjust to the 
care giving needs of workers in order to attract and retain the skilled 
labor force that allows them to remain competitive in an increasingly 
global marketplace. Doing right by families can also improve companies' 
bottom lines, such as lowering turnover rates of trained workers and 
absenteeism.
    Encouraging employers to do more to accommodate their workers' 
family care giving responsibilities is essential. But Congress must 
also examine ways to expand paid family and medical leave.
    Finally, family members must navigate a complex maze of medical, 
financial, insurance, and legal issues, so the one-stop shopping 
approach to care coordination that Ms. Wilcox's organization provides 
is an interesting model for us to study.
    The sandwich generation will only grow as the baby boomers age, so 
we must confront the challenges of elder care now.
    Mr. Chairman, Senator Klobuchar, thank you for holding this 
important hearing and I look forward to the testimony of our witnesses.
                               __________
Prepared Statement of Richard W. Johnson, Principal Research Associate, 
                          The Urban Institute
    The views expressed are those of the author and should not be 
attributed to the Urban Institute, its trustees, or its funders.
    Madame Chairwoman and members of the committee, thank you for the 
opportunity to testify today about the financial challenges confronting 
family caregivers.
    Many Americans provide crucial support to their frail older 
parents. Despite recent health improvements beyond age 65 (Manton, Gu, 
and Lamb 2006), most people continue to develop disabilities as they 
grow older and eventually require assistance with the basic tasks of 
everyday life. Spouses and adult children usually provide this help. 
Working without pay and often putting in long hours over many months or 
years, family caregivers significantly improve the quality of life for 
many frail older adults. The help they provide often keeps older people 
out of expensive nursing facilities and in their own homes, which most 
prefer. Informal family caregivers also save the public billions of 
dollars every year by reducing nursing home admissions and limiting the 
use of paid home care. Yet care responsibilities often impose serious 
burdens on caregivers, especially those balancing elder care duties 
with paid employment and care of their own children. These pressures 
will likely intensify as the population ages in coming decades. 
Although awareness of these strains is growing, we still have few 
public policies in place to support family caregivers.
    In my testimony today, I would like to make the following points:
      Frail older adults are among the most vulnerable groups 
in the nation;
      Informal care provides crucial support to frail older 
Americans;
      Adult children provide much of the unpaid care frail 
elders receive;
      Elder care responsibilities often create financial 
hardship for caregivers;
      Care burdens will likely grow in the future as the 
population ages; and
      Family caregivers need better support.
 frail older adults are among the most vulnerable groups in the nation
    About 10 million Americans ages 65 and older, representing about 29 
percent of the older population, need help today with basic personal 
activities or household chores and errands.\1\ About 2 million older 
people living at home, or 6 percent of the older population living 
outside of nursing facilities, are severely disabled, requiring 
assistance with three or more activities of everyday life, such as 
bathing, eating, dressing, or getting in and out of bed. These numbers 
will rise in the future as the population ages.
---------------------------------------------------------------------------
    \1\ Except where otherwise noted, the figures cited in this section 
and the following one are drawn from Johnson and Wiener (2006). These 
estimates were based on data from the 2002 Health and Retirement Study, 
a nationally representative survey of older Americans conducted by the 
University of Michigan for the National Institute on Aging. The study 
classified respondents as disabled if they reported any difficulty 
because of health or memory problems with at least one activity of 
daily living (ADL) or instrumental activity of daily living (IADL). 
ADLs reported in the survey consisted of bathing, getting in and out of 
bed, eating, dressing, walking across the room, and using the toilet. 
IADLs consisted of shopping for groceries, preparing hot meals, using 
the telephone, taking medications, and managing money. Respondents were 
not considered disabled if they expected their limitations to last no 
more than 3 months. The study also classified all older nursing home 
residents as being disabled.
    Other surveys generate somewhat lower estimates of old-age 
disability rates. For example, data from the National Long-Term Care 
Survey, conducted by Duke University for the National Institute on 
Aging, show that only 19 percent of older adults were disabled in 2004 
(Manton, Lamb, and Gu 2006).
---------------------------------------------------------------------------
    Frail older adults are among the most vulnerable groups in the 
nation. Disproportionately female, widowed, and in their 80s and 90s, 
most older people with disabilities have little education and limited 
financial resources. For example, median household income in 2001 
totaled $30,264 among those with no disabilities, $18,480 among those 
with moderate disabilities, and $14,160 among those with severe 
disabilities. Severely disabled older adults are nearly four times as 
likely to live in poverty as older adults with no disabilities. Frail 
older people hold little wealth, and most of what they have is tied up 
in their homes. In 2002, median household wealth among those with 
severe disabilities totaled only about $47,900, nearly three-fourths of 
which represented the value of their homes net of outstanding mortgage 
debt. Household financial assets, which can generally be liquidated 
easily to meet long-term care and other needs, amounted to only about 
$7,800 for the median older adult with severe disabilities. So less 
than one-half of older people with severe disabilities have more than a 
few thousand dollars that they can easily draw on to meet their health 
care needs.
    Besides physical limitations, many frail older adults have mental 
health problems and cognitive impairments. About 31 percent of older 
people with any disabilities and 45 percent of those with severe 
disabilities report depressive symptoms. Additionally, about 15 percent 
of frail older people are cognitively impaired. Cognitive impairments 
and depression and other psychological problems often limit physical 
functioning and intensify long-term care needs and caregiver burdens 
(Ormel et al. 2002; Ory et al. 1999).
    informal care provides crucial support to frail older americans
    Most frail older adults live at home, not in nursing facilities, 
and rely on unpaid help from family and friends. Only about 1.4 million 
older adults resided in nursing homes in 2002 (Spillman and Black 
2005), representing less than one-seventh of the frail older 
population. About 57 percent of frail older adults living at home 
received help from unpaid caregivers, including about 81 percent of 
those with severe disabilities.
    Paid help with basic personal care and household chores is rare. 
About 14 percent of all frail older adults living outside of nursing 
homes received paid home care in 2002, generally in combination with 
unpaid help from family and friends. Only 4 percent of frail older 
people living at home relied solely on paid helpers, without any unpaid 
supplemental help from family or friends. Nearly three-quarters of 
frail older recipients of paid home care services also obtained unpaid 
care from family and friends. About 82 percent of all the assistance 
with basic personal activities and household chores received by frail 
older adults comes from unpaid helpers.
    Frail older people rely heavily on informal care largely because 
paid services are expensive. In 2006, the average hourly rate for home 
health aides was $19 (MetLife Mature Market Institute 2006). For people 
who receive 60 hours of paid care each month--the median amount among 
recipients--costs average about $13,700. Private long-term care 
insurance can help defray some out-of-pocket costs, but coverage rates 
are low. In 2002, only about 10 percent of adults ages 65 and older had 
private coverage, including only about 7 percent of those with 
disabilities living at home. High premiums partly account for low 
coverage rates. Average annual premiums for a policy purchased at age 
65, for example, stood at $2,346 in 2002 (America's Health Insurance 
Plans 2004). Medicaid coverage, available to people with limited 
financial resources, also reduces the out-of-pocket price for paid home 
care, but only about one in six frail older adults living at home had 
coverage in 2002, though many had little income and few assets.
  adult children provide much of the unpaid care frail elders receive
    About 34 million adults provided care in 2004 to frail Americans 
ages 50 and older, representing about 16 percent of the adult 
population (National Alliance for Caregiving and AARP 2004).\2\ 
Although the number of men providing care has increased in recent years 
(Spillman and Pezzin 2000), women still make up the majority of 
caregivers. For example, 64 percent of primary caregivers in a recent 
survey were women (Donelan et al. 2002). And women devote about 50 
percent more time to care activities than men (U.S. Department of 
Health and Human Services 1998). Most people caring for adults are 
middle-aged, although about one in eight is age 65 or older (National 
Alliance for Caregiving and AARP 2004).
---------------------------------------------------------------------------
    \2\ Another 10.6 million adults, or 5 percent of the adult 
population, provided care to disabled adults ages 18 to 49 (National 
Alliance for Caregiving and AARP 2004).
---------------------------------------------------------------------------
    Adult children, primarily daughters, provide much of the care 
received by frail older adults, especially those not married. Daughters 
and daughters-in-law account for about 36 percent of unpaid caregivers 
to all frail older Americans (Johnson and Wiener 2006). Sons and sons-
in-law account for another 16 percent of unpaid caregivers. Slightly 
more than one-half of unpaid caregivers, then, are the children or 
children-in-law of the care recipient. (Spouses account for about 28 
percent of caregivers.)
    Children play larger caregiver roles when their parent is widowed 
and unable to rely on help from a spouse. Nearly three-quarters of 
unmarried older care recipients receive help from their children, with 
almost one-half receiving help from daughters and almost one-quarter 
receiving help from sons. Daughters serve as primary helpers with basic 
personal care for about two-thirds of unmarried older care recipients.
    Care responsibilities are generally quite time-consuming. On 
average, daughters who help their frail older parents provide about 134 
hours of care each month (Johnson and Wiener 2006). Daughters who serve 
as primary caregivers with basic personal care devote about twice as 
many hours--266 on average--to their parents. Caregiver 
responsibilities typically last about 4 years (National Alliance for 
Caregiving and AARP 2004).
    The benefits of unpaid family care to older Americans are 
substantial. These activities enhance the lives of millions of frail 
adults and permit many to live in their own homes instead of in nursing 
homes. In fact, frail older adults who receive frequent help from their 
children with basic personal care are about 60 percent less likely to 
enter nursing homes over a 2-year period than those who receive less 
help (Lo Sasso and Johnson 2002). If the adult sons and daughters who 
provide unpaid help to their frail older parents were paid the average 
hourly wage nursing aides receive for each hour of help, the cost in 
2005 would total about $45.9 billion.\3\ The value of unpaid help from 
all family and friends totaled about $102.7 billion in 2005. (Even if 
valued at the 2005 minimum wage of $5.15 per hour, the unpaid help 
children provide would be worth about $22.9 billion in 2005, and the 
assistance all unpaid helpers provide would be worth about $51.2 
billion.) By comparison, national spending for paid long-term care 
services in 2005 totaled about $206.6 billion (Komisar and Thompson 
2007).
---------------------------------------------------------------------------
    \3\ These estimates are based on the average help hours frail older 
adults receive, as reported in Johnson and Weiner (2006). The average 
hourly wage for nursing aides was $10.33 in 2005 (Bureau of Labor 
Statistics 2006). The computations exclude the cost of fringe benefits 
paid to nursing aides.
---------------------------------------------------------------------------
    elder care responsibilities often create financial hardship for 
                               caregivers
    Many unpaid caregivers to older Americans must balance their care 
duties with workplace demands and care responsibilities for their 
immediate families. About 53 percent of people caring for their frail 
parents are employed full time, and another 10 percent are employed 
part time (Johnson and Wiener 2006). About 11 percent of children 
caring for parents are ages 30 to 39 (Johnson and Wiener 2006), a life-
course stage when many people are raising young children. Another 68 
percent of caregivers are in their 40s and 50s, ages when many people 
still have dependent children at home. Overall, 37 percent of 
caregivers had children under age 18 (National Alliance for Caregiving 
and AARP 2004).
    Care responsibilities often interfere with paid employment. About 
57 percent of employed caregivers report that they sometimes have to go 
to work late, leave early, or take time off to attend to their care 
duties, and 17 percent said they had to take a leave of absence 
(National Alliance for Caregiving and AARP 2004). About 4 percent said 
their care responsibilities forced them to turn down a promotion. Only 
23 percent of companies with 100 or more employees have programs to 
support elder care (Families and Work Institute 1997).
    Elder care often takes place from a distance, which can make it 
more burdensome. Less than one-third of adult children providing elder 
care live with their frail parents, and more than one-quarter live more 
than 10 miles away from their parents (Johnson and Wiener 2006). Many 
long-distance caregivers live much further from the people they help. 
In a survey of 1,130 long-distance caregivers, the average distance 
between caregiver and recipient was about 450 miles (MetLife Mature 
Market Institute 2004). Nearly three-fourths of these caregivers were 
helping with transportation and household activities, such as shopping, 
cooking, and managing finances, on which they spent an average of about 
22 hours per month. More than 4 in 10 had to rearrange their work 
schedules to accommodate their care responsibilities, and more than 
one-third reported missing workdays.
    In a recent study, Anthony Lo Sasso of the University of Illinois 
at Chicago and I examined the impact of time spent helping frail older 
parents on paid employment hours for women ages 55 to 67 (Johnson and 
Lo Sasso 2006). We found that women who spend time helping their 
parents, either with basic personal activities or with household chores 
and errands, cut back their work hours by 367 hours per year. These 
work-hour reductions translate into average compensation losses of 
about $8,600 ($6,300 in lost wages and $2,300 in lost benefits) in 
2006.\4\
---------------------------------------------------------------------------
    \4\ This estimate assumes that workers receive hourly wages of $17 
(the median value for women in 2006), 60 percent receive employer-
sponsored health benefits, and 50 percent participate in 401(k) 
retirement plans. The estimates also assume that the average monthly 
employer contribution for health benefits was $297 for covered workers 
(Kaiser Family Foundation and Health Research and Educational Trust 
2006), and that employers contributed 5 percent of salary to 401(k) 
plans for covered workers.
---------------------------------------------------------------------------
    Care responsibilities also take emotional and physical tolls on 
caregivers. Caregivers exhibit higher levels of depressive symptoms and 
mental health problems than their peers who do not provide care (Marks, 
Lambert, and Choi 2002; Pinquart and Sorensen 2003; Schulz et al. 
1995). Caregiver depression intensifies as the care recipient's 
functional status declines. For example, between 30 and 40 percent of 
dementia caregivers suffer from depression and emotional stress 
(Alzheimer's Association and National Alliance for Caregiving 2004; 
Covinsky et al. 2003). Care responsibilities also appear to impair 
physical health. Caregivers are more likely to develop serious illness 
than noncaregivers (Shaw et al. 1997) and are less likely to engage in 
preventive health behaviors (Schulz et al. 1997). Stressed elderly 
spousal caregivers exhibit higher mortality rates than people of the 
same age who do not provide care (Schulz and Beach 1999). Caregiver 
stress also appears to push older people into nursing homes. For 
example, frail older adults with a highly stressed caregiver are about 
12 percentage points more likely to enter a nursing home within 1 year 
than those with less-stressed caregivers (Spillman and Long 2007).
              care burdens will likely grow in the future
    Caregiver burdens are likely to increase in coming decades as the 
baby boomers age and the number of older people with disabilities 
grows. Between 2000 and 2050 the size of the population ages 65 and 
older is projected to increase from 35 million to 87 million, while the 
population ages 85 and older, which has the highest disability rate of 
any age group, is expected to increase from 4 million to 21 million 
(U.S. Census Bureau 2004).
    The number of older people with long-term care needs depends, of 
course, on the evolution of old-age disability rates, which is 
difficult to forecast. There is a growing consensus that limitations in 
instrumental activities of daily living, such as difficulty performing 
household chores and errands, and functional limitations, such as 
difficulty bending, reaching, and stooping, declined during the 1990s 
(Freedman, Martin, and Schoeni 2002). There is less agreement, however, 
about recent trends in the more severe type of disability that involves 
limitations with basic personal care, such as eating, dressing, and 
bathing. Although one study found that the share of the older 
population with these types of limitations declined by about 20 percent 
between 1982 and 2005 (Manton, Gu, and Lamb 2006), other studies have 
found no significant changes or small increases (Crimmins and Saito 
2000; Crimmins, Saito, and Reynolds 1997; Liao et al. 2001; Schoeni, 
Freedman, and Wallace 2001; Waidmann and Liu 2000).
    There is no guarantee, of course, that disability rates will 
decline in the future, even if they declined in the recent past. 
Disability associated with the rising prevalence of diabetes and 
obesity in the younger population might offset future declines in 
disability rates at older ages (Lakdawalla et al. 2003; Mokdad et al. 
2000, 2001). In fact, between 1984 and 2000, disability rates increased 
at ages 40 to 49 while falling at ages 60 to 69 (Lakdawalla, 
Bhattacharya, and Goldman 2004). Recent research also found that adults 
born between 1948 and 1953 reported worse health in 2004, when they 
were ages 51 to 56, than those born 12 years earlier reported in 1992, 
when they were the same age (Soldo et al. 2006). Other research, 
however, found that mortality rates at ages 55 to 74 were lower between 
1999 and 2002 than between 1971 and 1975, largely because of lower 
smoking rates and better control of blood pressure (Cutler, Glaeser, 
and Rosen 2007).
    Any plausible assumptions about future disability rates imply that 
the number of frail older Americans and the ratio of frail older adults 
to people ages 25 to 64 will increase in coming decades. For example, 
even if we assume that disability rates decline by 1 percent per year 
between 2000 and 2040--a cumulative drop in the old-age disability rate 
of about one-third over the period--the total number of older adults 
with disabilities will increase by about 50 percent (Johnson, Toohey, 
and Wiener 2007). Moreover, the number of people ages 25 to 64, who 
generally work and pay taxes that finance government services for 
people with disabilities, will drop over the period, implying that 
overall care burdens will likely intensify. Under the more plausible 
assumption that old-age disability rates will decline by only 10 
percent between 2000 and 2040, the number of frail older Americans will 
more than double over the period.
    The growth in the size of the frail older population relative to 
the younger population, combined with likely employment gains for 
women, will raise future caregiver burdens. A recent Urban Institute 
study found that the average educational attainment of frail older 
Americans' adult daughters will steadily improve over time (Johnson, 
Toohey, and Wiener 2007), reflecting recent increases in college 
graduation rates among young women. These educational gains will boost 
women's average earnings, but will also increase the financial cost of 
unpaid elder care as women who reduce paid work to provide care in the 
future will have to forgo higher wages. The Urban Institute study 
predicted that the share of frail older adults receiving unpaid family 
care will decline by a few percentage points as the financial costs of 
elder care grow and as rising old-age incomes make paid home care more 
affordable. Nonetheless, most older care recipients will continue to 
rely on unpaid help from their adult children.
                 family caregivers need better support
    About two-thirds of caregivers in a recent survey said they needed 
more help or information (National Alliance for Caregiving and AARP 
2004). More than one in three said they needed help finding more time 
for themselves, and about 3 in 10 said they needed help or information 
about balancing work and family responsibilities as a caregiver, and 
managing emotional and physical stress.
    Despite the importance of unpaid care to frail older adults, few 
policies are in place to support family caregivers. The three primary 
Federal initiatives for caregivers, the Family and Medical Leave Act 
(FMLA), the National Family Caregiver Support Program, and Medicaid 
home and community-based services, offer some help, but not enough.
Family and Medical Leave Act (FMLA)
    Enacted in 1993, the FMLA guarantees workers up to 12 weeks of 
unpaid leave in any 12-month period to care for a newborn child (or 
newly adopted child); care for an ill child, spouse, or parent; or deal 
with one's own health problems. However, the law only covers workers in 
firms with 50 or more employees who have worked for the employer for at 
least 12 months and at least 1,250 hours that year. As a result, only 
about 47 percent of private-sector workers qualify for FMLA leave 
(Waldfogel 2001).
    One-sixth of all employees participating in a 2000 survey took 
leave for family or medical reasons in the 18 months prior to the 
survey (Waldfogel 2001). Most use leave to deal with their own health 
problems or to care for a newly born or adopted child. Only 11 percent 
of leave takers in 2000 used it to care for ill parents, and only 6 
percent used it to care for an ill spouse. The loss of pay while not 
working substantially reduces the use of FMLA leave.
    California is the only state with a comprehensive paid family and 
medical leave insurance program. Funded solely by employee 
contributions, the program pays workers up to 60 percent of their wages 
when they take leave to care for newborns, newly adopted children, 
newly placed foster children, or seriously ill family members or 
domestic partners. Workers can receive up to 6 weeks of paid leave per 
year.
    Washington Governor Chris Gregoire signed a bill last week 
establishing a family and medical leave insurance program in her state. 
It will provide $250 per week to beneficiaries for up to 5 weeks, but 
it only covers leave to care for a newborn or newly adopted child. 
Elder care benefits are not available.
National Family Caregiver Support Program
    The National Family Caregiver Support Program, created in 2000 by 
the Older Americans Act, provides funds to states to support family 
caregivers helping older people. It finances the following services:
      Information to caregivers about community services;
      Assistance to caregivers in gaining access to supportive 
services;
      Individual counseling and training for caregivers;
      Respite care to allow caregivers to receive temporary 
relief from care obligations; and
      Limited supplemental services, such as emergency response 
systems and home modifications, to complement the care provided by 
family caregivers.
    The funding provided to states by the National Family Caregiver 
Support Program has made an important difference for frail older 
Americans and their caregivers. Before the program began, for example, 
18 states and the District of Columbia had no state program funded 
primarily through state general funds that served family or informal 
caregivers (Feinberg et al. 2004). Today programs exist in all 50 
states and the district. However, inadequate funding levels have 
limited its impact (Wisendale forthcoming). The president's fiscal year 
2008 budget requests only $154 million for family caregiver support 
services (Administration on Aging 2007).
Medicaid Home and Community-Based Services
    Medicaid, mainly through its waiver programs, supplies the majority 
of public funding for home and community-based care. Financed by the 
Federal Government and the states, these programs focus on the care 
recipient but indirectly sustain family members in their caregiver 
roles. They have grown enormously over the past two decades (Reester, 
Missmar, and Tumlinson 2004). However, services are available only to 
low-income beneficiaries, generally with incomes at or below 300 
percent of the Federal Supplemental Security Income (SSI) level, and 
funding constraints in some states limit services even for those who 
qualify.
                               conclusion
    The important work of family caregivers deserves more public 
support. Informal help from family members enriches the lives of 
millions of frail older Americans and saves the Nation billions of 
dollars each year in paid home care and nursing home costs. Yet it 
creates substantial financial, physical, and emotional burdens on 
caregivers, which will only intensify in coming decades as the 
population ages. Creating a system of paid leave, as in California, 
might benefit some caregivers, but a few weeks of paid leave will not 
help most people engaged in elder care for many months or years. 
Additional funding for the National Family Caregivers Support Program 
would likely have more impact by giving local governments the ability 
to provide more supportive services that family caregivers need.
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                               __________
  Prepared Statement of Virginia Morris, Author of ``How To Care for 
                 Aging Parents,'' Sag Harbor, New York
    People have cared for their elderly relatives throughout human 
history and across all nations and cultures. Given this, it seems that 
eldercare should be second nature, something we just do. And yet, in 
developed countries, in just the past couple of generations, this age-
old task has changed. Dramatically.
    Once upon a time, people grew up, they grew old, they got sick, and 
they died. Caring for an elderly relative meant sharing meals, helping 
out with some chores, and then, for a few weeks, seeing them through 
sickness and death.
    Today, people are not only living longer--into their 90s and 
beyond--but they are often living these extended years with acute, 
debilitating illness--illnesses that last not for a few weeks, but 
years.
    Elderly relatives need much more than a little TLC. They need 
catheters, oxygen tanks, and wheelchairs. They need someone to put a 
spoon in their mouths, to get them on the toilet, pull on their socks, 
and remind them what day it is. They need someone to oversee an arsenal 
of medications and a cadre of medical specialists. And they need 
someone to make sense of Medicare, Medicaid, Medigap, Plan D, long-term 
care insurance, senior discounts, reverse mortgages and a seemingly 
endless stream of medical bills.
    But this isn't all that has changed. While the needs to the elderly 
have grown, the time and availability of caregivers has diminished. In 
our wildly mobile society, family members often live far apart. 
Children of aging parents can't just walk down the block or jump in the 
car to check on mom or bring dad some soup. They often live 2 hours 
away--by plane.
    Furthermore, women--and the vast majority of caregivers are women--
are working, and they are having children later. They are juggling not 
just work and motherhood, but eldercare too. On a given day they must 
decide whether to stay at work, go to a teenager's big soccer game, or 
get mom to her doctor's appointment.
    And yet, 80 percent of the care provided to the elderly--this 
includes help with eating, toileting, dressing, changing bandages, 
giving medications, etc.--comes from family. Estimates put the value of 
this care at nearly $300 billion each year. I would argue that it is 
priceless.
    Nearly 50 million people in this country care for an elderly 
relative and these numbers are rapidly climbing. Some 78 million baby 
boomers are now moving into their 50s and 60s, which means that their 
parents are between 70 and 95. Eldercare is upon us.
                               the impact
    There are rewards, of course--intimate moments and loving 
exchanges, gratitude and reconciliation. People want to care for their 
loved ones. And yet, the rewards are hard to see when one is in the 
trenches. The costs to caregivers are phenomenal on many levels.
Time required
    First of all, on the most simple level, there is the time involved. 
Caring for an elderly relative is a part-time job, if not a 24/7 
obsession. The average caregiver spends 20 hours a week caring for an 
elderly person, but many of them live and breathe it. Mom has 
Alzheimer's, she's moved into the den, and recently she's become 
hostile and paranoid. She attacks any hired help. Her daughter is the 
only one who can calm her (although Mom is convinced at times that even 
her daughter is trying to poison her). The last time she was left alone 
for a few minutes she tried to warm up some soup and nearly burned the 
house down.
    According to the National Alliance for Caregiving and AARP, 17 
percent of family caregivers devote 40 hours a week or more to this 
task.
    Even those caregivers who don't provide hands-on, physical care 
spend hours upon hours pouring over bills and insurance forms, 
consulting doctors, calling local service providers, and generally 
making sure the aide showed up, mom took her medicine, dad ate some 
lunch, and neither is driving the car.
    People sometimes assume that once a parent is in an assisted living 
facility or nursing home that the family's job is done. But the work 
doesn't disappear; it simply changes course. Loved ones still need to 
check in constantly, manage staff, deal with finances, and confer with 
doctors.
Emotional cost
    Beyond the sheer time involved, is the emotional strain, and this 
is no small matter. Caregivers worry endlessly. They typically feel 
helpless and confused, as they don't know what to do, how to help, or 
where to turn. The system is nearly impossible to understand, much less 
navigate, and what's at stake is dire. They feel guilty that they 
aren't doing more, resentful that they have to do so much, and anxious 
that whatever they are doing is wrong. The parent-child relationship, 
which is already loaded (She's critical of everything I do. He micro-
manages my life. My sister was always his favorite), is turned upside 
down. They often become isolated, as they no longer have time for 
friends or any sort of social life. Coupled with all of this, there is 
grief, because this is, after all, about loss.
    Caregivers are typically exhausted, isolated, and overwhelmed. As a 
result, they often become clinically depressed or physically sick. 
Volumes of studies show that caregivers have higher rates of depression 
and morbidity, and generally have a shorter life span.
Strains on family
    When you consider the time that is required and the emotions that 
are involved, it's no small wonder that caregivers have little energy 
for spouses or children. Marriages are tested, and often dissolve. 
While men are getting more involved in eldercare, women still shoulder 
the brunt of it. In fact, women often find themselves caring for their 
in-laws, as well as their own parents. The stress and strain simply 
becomes too much for a marriage to bear.
    Likewise, children are neglected--neglected, just when they need so 
much attention, as they are affected by Grandpa's confusion or 
Grandma's frailty. This is the era of the ``sandwich generation,'' 
those pulled between the demands of children and aging parents. Who 
will get mom's time--an anguished teenager, a frail parent or a 
disgruntled spouse? About 40 percent of caregivers have children under 
18 living at home.
Financial implications
    The average cost of nursing home care in the U.S. (as of March, 
2006) is more than $70,000 a year. That price tag does not include the 
cost of medications or rehabilitative therapy. In certain areas, the 
price soars even higher. In New York City, for example, the average 
cost of nursing home care is now more than $140,000 a year.
    Assisted living facilities generally cost much less than nursing 
homes (nearly half). The cost of in-home care varies widely, depending 
upon the needs of the elderly person and the availability of family 
members. Generally speaking, in-home care costs far less than nursing 
home care, unless a person needs 24-hour care, including several hours 
of nursing care.
    Medicare covers almost none of this, and most older people do not 
have long-term care insurance. Instead, people pay these bills 
themselves until they are impoverished, at which point they qualify for 
Medicaid. Family members often pitch in, so not only is the elderly 
person impoverished, but often the caregiver's personal finances are 
strained as well.
    Obviously, long-term care is an enormous financial burden for 
families. Those on one extreme end of the spectrum can pay for it. 
Those on the other end quickly find themselves in the safety net of 
Medicaid (not great, but adequate). But the vast majority of families 
reside in the gap. They have faithfully paid off their mortgages and 
put aside a reasonable nest egg, only to find their savings quickly 
decimated.
Caregiving and work
    Beyond the obvious financial hit of long-term care, is a less 
obvious, but just as pressing, issue--the toll eldercare takes on a 
caregiver's work life.
    According to a study by the National Family Caregivers Association 
done in 2001, one half of all caregivers are employed. The statistics 
on how they handle this vary, but it is clear that many quit work 
completely, and between 50 and 70 percent make adjustments at work, 
largely by cutting back their hours. The vast majority make phone calls 
and send emails related to eldercare during the workday, and virtually 
all of them are distracted, preoccupied and exhausted at work because 
of their caregiving duties.
    A 2006 study by MetLife Mature Market Institute estimated that the 
cost of eldercare, in terms of lost productivity to U.S. businesses, 
was nearly $34 billion a year.
    Behind the statistics are real-life stories:
    Ann's father lives with her. He has mild dementia and recently lost 
most of his eyesight. He wakes frequently during the night. He needs 
someone to watch him all the time, as he hallucinates, and is also 
likely to fall down the stairs or wander out into the street. Ann has a 
15-year-old daughter and cannot afford to leave her job. But hiring 
someone to stay with her father during the day will cost more than she 
earns. She is frazzled and frightened. She hasn't had a full night's 
sleep in weeks. She's put together a patchwork of help, but it is a 
temporary fix. She doesn't know what to do or where to turn.
    Lindsey lives in Illinois and her mother, who is 83, lives in 
Mississippi. As an only child, the onus of care falls to her. Lindsey 
has used up all of her sick days and personal days visiting her mother, 
who recently had heart surgery. She knows that her mother will only 
grow weaker and more frail. Lindsey has one child at home and one in 
college. She is worried about the future. She is worried how she will 
care for her mother and how all this will affect her work and income. 
As someone who works in sales, and is dependent upon commissions, she 
cannot afford to miss work.
    Cheryl is a social worker in a school. Her mother lives nearby and 
has early Alzheimer's disease. On several occasions, Cheryl has had to 
stop what she's doing, walk away from troubled students, to deal with a 
crisis concerning a mother. She also has a child at home. She worries 
what she'll do as her mother's illness grows worse, how she'll continue 
to work, how she'll pay for her mother's care. She says, ``How do you 
begin to prioritize things in your life?''
    Mary's in-laws moved in recently. She and her husband pay all his 
parents' bills. She also worries all day from work--are they eating, 
are the OK alone, are they safe, how will we continue to pay for this. 
The emotional and financial pressure, along with the lack of privacy or 
free time, has put so much strain on their marriage that Mary doesn't 
think they will survive it.
                            a critical need
    I typically address caregivers, not policymakers, and when I do I 
make two main points. One, plan ahead. If we could simply get people to 
think about all this sooner, to plan for it even a little bit, we could 
ease the strains enormously. Unfortunately, most people approach 
eldercare one crisis at a time.
    But the second point is the one I want to stress to this committee 
today: Take care of the caregivers.
    We've all heard flight attendants instruct us to put on our own 
oxygen masks before assisting someone else. They say this for a very 
good reason: You can't help someone else if you are suffocating. 
Caregivers need oxygen.
    Although there are dozens of them, I don't think we don't need 
studies to tell us that caregivers who have support, who have access to 
services, and who take breaks, take better care of their elderly family 
members, stay at this task for a longer period of time, and keep their 
loved ones out of institutions. They also are less apt to be depressed, 
sick and impoverished themselves.
    Most caregivers, however, do not have such support. They do what 
they can until they burn out, until they are physically sick, 
clinically depressed, unemployed, abusive, financially strained, and/or 
contemplating divorce, and then they reluctantly put Dad in a nursing 
home.
    In my experience, several things determine whether an elderly 
person enters a nursing home. Dementia, immobility, and incontinence 
are obviously huge factors. But the caregiver's health and emotional 
well-being are also deciding factors.
    Caring for the caregiver is a win-win situation. Families want to 
take care of their aged relatives. Elderly people want to stay in their 
own homes. And we, as a society, want to avoid the enormous expense and 
questionable care associated with institutions.
                           thoughts on policy
    I am not a policy person, but I have studied this issue for nearly 
15 years, so there are a few things that come to mind.
    One, don't reinvent the wheel (or, in this case, the wheelchair). 
It would be helpful to fully review what's out there, what works, why 
it works, and what doesn't work. Beyond the larger programs--PACE, 
Beacon Hill Village, consumer-directed programs, care voucher programs, 
California's Caregiver Resource Centers, Oregon's Lifespan Respite 
Program, Pennsylvania's Family Caregiver Support Program, etc., etc.--
there are hundreds of small-scale projects underway.
    Any review should look internationally, as well. Israel, for 
example, has introduced a number of new programs in recent years--a 
network of day care centers, intergenerational housing programs, wide-
scale volunteer programs, counseling centers, and public insurance 
programs.
    Overall, caregivers need support, counseling, education, respite, 
adult day services, transportation and meal delivery programs, 
companions and aides, and homemaker and handyman services.
    We also need:
    Early intervention in order to assist caregivers before they burn 
out.
    Help navigating the current system, which is impossibly fragmented 
and complicated.
    Assessments of caregivers when the elderly are assessed (as they 
often are by medical clinics, community case workers, hospitals and 
nursing homes).
    More services in rural areas, which are often lacking programs.
    Volunteer initiatives that put both young people and old people to 
work caring for those in their communities.
    Intergenerational programs that do not sequester the elderly. 
Integrating our seniors into our lives and communities is essential for 
any program.
    A holistic approach that addresses the numerous needs of both the 
caregiver and the elderly person.
    The population of elderly people is growing rapidly and the needs 
of this population are greater than ever before. We need to support our 
family caregivers now so that we are not left supporting this large 
population of elderly up the road.
    Thank you.
    [GRAPHIC] [TIFF OMITTED] T6705.002
    
    Prepared Statement of Leni Wilcox, Division Director, Community 
   Services for the Elderly, Amherst H. Wilder Foundation, St. Paul, 
                               Minnesota
    Good morning Chairman Schumer and distinguished members of the 
Joint Economic Committee. Thank you, Senator Klobuchar, for bringing 
this critical issue before the committee and inviting testimony from a 
community-based provider of caregiver services. My name is Leni Wilcox 
and I am Division Director of the Amherst H. Wilder Foundation's 
Community Services for the Elderly in St. Paul, Minnesota. Each year, 
Wilder provides a number of community-based, long-term care services to 
nearly 2,000 low income, older and disabled adults in the Twin Cities 
East Metro area. Our goal is to help older adults and their family 
caregivers so that the older adult can continue to live independently 
and remain actively involved in the community as long as possible.
    One of our most valued partnerships is with three other like-
minded, nonprofit social service agencies that serve seniors and their 
caregivers in the Twin Cities area: DARTS in Dakota County, Human 
Services, Inc. in Washington County, and Senior Community Services in 
Hennepin County. We have partnered to offer one-stop access to care 
coordination and all of our services, including our caregiver coaching 
service, a national winner of the 2006 Family Caregiving Award for 
innovation and effectiveness. This partnership, Eldercare Partners, is 
funded by a National Family Caregiver Support Program grant from our 
Metropolitan Area Agency on Aging, and provides support to 
approximately 400 family caregivers each year, giving them the skills 
they need to do one of life's toughest jobs. Eldercare Partners 
caregiver coaches provide in-depth assessment of the caregivers and 
then help them navigate the fragmented service system, provide family 
mediation if needed, and develop a longitudinal relationship with them 
to build skills, confidence and resilience. Educating and equipping 
this generation of caregivers will not only benefit today's seniors, 
but will foster a new cohort of informed adults better prepared for 
their own aging.
             caregivers are affected by demographic trends
    Many factors, including advances in nutrition, public health, and 
medicine have increased the U.S. life expectancy by approximately 24 
years per century.\1\ In addition, our population is aging. Tom 
Gillaspy, Minnesota State Demographer, reports that over the next two 
decades, the number of Minnesotans over the age of 65 will double, and 
by the year 2030 older people will represent over 20 percent of the 
state's population. Our aging population, living longer, may acquire 
more chronic disease and utilize services longer. Increased health care 
costs, fragmented service systems, and lack of self-identification make 
the otherwise savvy Baby Boomers ill-prepared for their caregiving 
roles.
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    \1\ Lee, R. 2003. Mortality Forecasts and linear Life Expectancy 
Trends. University of California, Berkeley.
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    Today's families are smaller, more geographically dispersed, and 
often require dual incomes to meet basic family needs. Statistically, 
there are fewer caregivers per elder than in past generations and the 
caregiver role today can last much longer than it once did. A 2003 
study noted caregivers spend an average of 4.3 years providing care. 
Many are in that role significantly longer than the average.\2\
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    \2\ National Alliance for Caregiving and AARP. Caregiving in the 
U.S. Bethesda: National Alliance for Caregiving, and Washington, DC: 
AARP, 2004.
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             caregivers are vulnerable, valuable, and vital
    We know that there are two types of caregivers--(1) those with 
mastery who have learned how to cope, when to ask for help and where to 
find it, and (2) those who feel physically overwhelmed, emotionally out 
of control, and financially stressed. Organizations like ours are 
critical to helping this second group of caregivers manage not only the 
lives of the care recipients, but also their own lives. In too many 
cases, if caregivers do not receive support, they may ultimately no 
longer be able to fulfill their caregiving role.
    Caregiving creates physical, emotional and financial complications 
for the caregiver. Eleven percent report that caregiving has negative 
impacts on physical health.\3\ Multiple studies report that caregivers 
experience increased physical strain, disturbed sleep and elevated 
stress levels. Caregivers encounter chronic conditions such as heart 
attack/heart disease, cancer, diabetes and arthritis at almost twice 
the normal rate. Caregivers report lower levels of self-care, are more 
likely to smoke, and have higher alcohol abuse and prescription drug 
use. They report that their eating and exercise habits have worsened as 
a result of their role. The ultimate sacrifice of caregiving is earlier 
death. Spouses, aged 66-96, who experience caregiving related stress, 
have a 63 percent higher mortality rate than non-caregivers of the same 
age.\4\
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    \3\ Center on an Aging Society, 2005. How Do Family Caregivers 
Fare? A Closer Look at Their Experiences. (Data Profile #3). 
Washington, DC: Georgetown University.
    \4\ Schulz, R. and S. R. Beach, Caregiving as a Risk Factor for 
Mortality: The Caregiver Health Effects Study, JAMA 282 (1999): 2215-
2219.
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    The emotional toll of caregiving impacts both individual and family 
structure. Constantly changing needs, priority conflicts and family 
expectations often create guilt, depression and stress. In addition, a 
caregiver's identity is continually challenged throughout the journey 
with lessening of self-esteem, personal value, and life purpose. 
Estimates show that between 40 and 70 percent of caregivers have 
clinically significant depression.\5\
---------------------------------------------------------------------------
    \5\ Zarit, S., Assessment of Family Caregivers: A Research 
Perspective. In Family Caregiver Alliance (Eds.), Caregiver Assessment: 
Voices and Views from the Field. Report from a national Consensus 
Conference (Vol II). San Francisco: Family Caregiver Alliance.
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    Families experience financial burdens because of caregiving. While 
an estimated 60 percent of caregivers are employed either full or part-
time, they often struggle with balancing family and work. Many must 
rearrange their work schedules, decrease their hours, and take unpaid 
leave to meet their caregiving responsibilities. Assuming a caregiving 
role often leads to workplace absenteeism, reduced job responsibility, 
lost wages, job termination, and interrupted contributions to Social 
Security and retirement plans. One study found that women who were 
caregivers during their working years were 2.5 times more likely to 
live in poverty as elders than women who had not been caregivers.\6\
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    \6\ Wakabayashi, C. and K. M. Donato. 2004. The Consequences of 
Caregiving for Economic Well-Being in Women's Later Life. Presented at 
the annual meeting of the American Sociological Association, San 
Francisco.
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    Most long-term care is not provided in nursing homes. Families and 
friends provide approximately 80 percent of the long term care in the 
U.S.\7\ and 96 percent in Minnesota.\8\ In 2000, the U.S. 
Administration on Aging reported that 50 percent of the elderly who 
need long-term care but had no family to care for them, use nursing 
home care. In contrast, only 7 percent who have a family caregiver live 
in an institution. The estimated value of informal caregiving is $306 
billion dollars annually.\9\ Caregiving is a core social value in 
America regardless of income, cultural background, or geographic 
region. Families value their elders and want to care for them as they 
age and need help. Most caregivers are unsung heroes who find great 
personal satisfaction and growth without asking for recognition or 
thanks. The caregiver role is not an easy one and services like 
Eldercare Partners help the caregiver juggle work, raise children, care 
for their parents, and mitigate stress and burn-out.
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    \7\ Thompson, L., Long-term care: Support for family caregivers 
(Issue Brief). Washington, DC: Georgetown University, 2004 and Long-
Term Care Financing Project, Long-term Care Users Range in Age and Most 
Do Not Live in Nursing Homes. U.S. Agency for Healthcare Research and 
Quality, November 8, 2000.
    \8\ Status of Long-Term Care in Minnesota 2005. A Report to the 
Minnesota Legislature. Minnesota Department of Human Services Aging 
Initiative. June, 2006.
    \9\ National Family Caregivers Association and family Caregiver 
Alliance (2006). Prevalence, Hours and Economic Value of Family 
Caregiving, Updated State-by-State Analysis of 2004 National Estimates 
(by Peter S. Arno, PhD). Kensington, MD: NFCA and San Francisco, CA: 
FCA.
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              caregivers benefit from services and support
    Research continues to show the effectiveness of caregiver support 
programs. In 2004, Dr. Terry Lum, University of Minnesota, evaluated 
the Eldercare Partners caregiver coaching service and found that it 
significantly reduced the level of burden experienced by caregivers and 
helped them cope and provide care longer. In December 2005, the 
Partners in Care study\10\ demonstrated that caregiver coaching is an 
effective intervention for empowering caregivers to acquire knowledge 
and skills, creating improvement in attitudes and behaviors related to 
self and self-care. Multi-intervention programs make a difference. One 
study showed that patients whose spouses received individual and family 
counseling, support group participation, and phone support as needed 
experienced a 28.3 percent reduction in the rate of nursing home 
placement and delayed the median time of institutionalization by 557 
days.\11\
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    \10\ McGee, P. and H. Tuokko. 2005. Partners in Care: Empowering 
Caregivers Through Coaching. Centre on Aging, University of Victoria.
    \11\ Mittelman, M. S., Haley, W. E., Clay, O. J., Roth, D. L. 2006. 
Improving caregiver well-being delays nursing home placement of 
patients with Alzheimer disease. Neurology, 67: 1592-1599.
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    The stories of several caregivers served by Eldercare Partners 
illustrate the effectiveness of caregiver coaching. For example, take 
Alice. Her father is 80 years old, a polio survivor now living with 
congestive heart failure, kidney failure, and depression. Alice left 
her full-time job to provide the considerable assistance and 24-hour 
supervision he needs. She is paid as a personal care attendant for some 
of her caregiving hours, but her own income has decreased dramatically. 
She struggles to find time for the rest of her family and worries about 
how she is neglecting her own health. The Eldercare Partners coach has 
helped Alice find useful resources--a mental health consultant for her 
dad, a rabbi who will visit him at home, a volunteer who provides 
respite for her. And the coach has been strategizing with her about how 
to improve her own health. Alice announced proudly to her coach that 
she had spent one and a half hours with her dog at the dog park--a 
remarkable achievement for this caregiver.
    Another example is Karen. Karen's responsibility is even more 
daunting. She is the primary caregiver for both her mother, who has 
Alzheimer's disease, and her brother, who has cerebral palsy and 
obsessive compulsive disorder. Karen tries to handle her paid job while 
also meeting their daily needs--finding appropriate adult day programs 
for each, arranging transportation, accompanying them to medical 
appointments, learning about the mental health system, keeping bills 
and insurance matters straight--all the while adjusting to the fact 
that her mother no longer recognizes her. Karen's mother recently moved 
from Karen's home to a memory care facility, which adds a new dimension 
to her caregiver role. And she will be caring for her brother well into 
the future. Caregiving requires stamina, and the advice and support of 
an Eldercare Partners coach has helped Karen maintain a healthy 
perspective throughout her journey. The coach has guided her through 
complex systems and difficult family conflicts. She's sleeping better 
now and she says, ``at least I'm not stressed over getting stressed.''
    And finally, John. John, in his mid-50's, lives in Minnesota and 
cares for his mother who lives in Virginia. John's mother has multiple 
sclerosis, and he has been a long-distance caregiver for many years. 
Because she has now developed arthritis as well, both decided the 
mother should move closer to her son. John has many questions. Would 
airline staff help her transfer from her wheelchair to the seat in the 
plane, or must someone accompany her on the trip? Where can she afford 
to live that has the services she'll need? Will she have to switch 
Medicare HMOs when she moves? Is a Power of Attorney executed in 
Virginia valid in Minnesota? The Eldercare Partners coach helped him 
find the answers and navigate the resources, saving him the frustrating 
and time-consuming false starts that many caregivers experience. This 
access assistance is helping John create a smooth transition for him 
and his mother.
                 caregivers tap various funding sources
    Eldercare Partners receives funds from the Metropolitan Area Agency 
on Aging via the Minnesota Board on Aging, originating from Title III-E 
of the Older Americans Act. Our member organizations match these funds 
with support from municipalities, counties, foundations, United Way, 
and corporate and individual contributions. Service users pay a share 
of the cost using a sliding scale based on the care receiver's income, 
per OAA requirements.
    But Older Americans Act funded services comprise only a portion of 
what caregivers need. Additional supportive services are offered by 
nonprofit organizations, faith communities, and for-profit companies. 
Most assistance is purchased directly by consumers at market rates or 
with sliding fees. Other funding streams Minnesota caregivers can tap 
include: Alternative Care and Elderly Waiver for financially and 
functionally eligible individuals, primarily focused on services used 
by the care receiver; Consumer Directed Care, which is available under 
the waivers and through Title III-E, giving consumer families funds to 
purchase services they choose; Long Term Care Insurance, which may 
cover in-home services for the care receiver that provide relief for 
the caregiver.
                        caregivers need our help
    We feel that attention to supporting caregivers is critical for our 
future. There are three things that are very important to note:
      The magnitude and challenging circumstances of caregiving 
today are unprecedented in this country. As Dr. Johnson described in 
his testimony, demographic and social trends will exacerbate these 
problems in the future. With the retirement of the Baby Boomers 
starting in 2011, our aging population will increase quickly. By 2030, 
there will be about 71.5 million older persons, or more than twice the 
number there were in 2000. The 85+ population will grow even more 
dramatically in that timeframe.\12\ While we are living longer, it 
isn't clear whether disability rates will decline or not. Many Baby 
Boomers have smaller and non-traditional families. And they are mobile, 
sometimes living a long distance from their parents and children. To 
exacerbate the problem, in most parts of the country there are 
workforce shortages of formal care professionals like nurses and home 
health aides. Support for informal caregivers will be critical to 
helping older adults remain at home in more cost-effective, community-
based settings.
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    \12\ Department of Health and Human Services. Administration on 
Aging. A Profile of Older Americans: 2006.
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      The economic impact of caregiving can span multiple 
generations. Most caregivers are women, but we are seeing more and more 
men in this role. Both men and women are affected by its short-term and 
long-term consequences. In the short-term, high caregiver stress is 
associated with premature nursing home admission for the care receiver. 
In the long run, the caregiving role can have a significant impact on 
the economic well-being of the caregiver. Negative impacts on job 
performance and even the ability to retain employment affects many 
caregivers who sacrifice not only their income, but their future 
retirement security. Add to that a body of evidence that shows that the 
mental and physical health of caregivers are at risk, setting them up 
for disability and future increased health care costs.
      Service awareness, access, and navigation are our 
greatest challenges. Finally, the service and financing ``systems'' 
that support community-based long-term care are chaotic, fragmented 
and, frankly, frightening. The availability of supportive services is 
not a level playing field with great variation among states and between 
metropolitan and rural areas. Indeed, there are access barriers for 
people of all incomes. Although mainstream media coverage about Boomers 
caring for their parents has certainly increased, there is a great need 
for more public education to make people who are caring for a loved one 
aware of services, like those funded under Title III-E, so they can get 
support and help to navigate our disjointed system.
    Caregivers are the heart of the long-term care system and we must 
do more to address their physical, emotional and financial challenges. 
Shifting the focus and funding of long-term care to community services 
is essential. The National Family Caregiver Support Program of the 
Older Americans Act was a significant first step. It brought needed 
resources and attention to caregiver needs, but caregiver awareness 
still remains low, service availability is spotty, and access is 
difficult. You can help by keeping this issue alive in the public 
discourse, strengthening access points and navigation assistance, and 
allowing flexibility in service design so that caregivers have options 
that suit their unique circumstances. We all need caregivers. They need 
our help.
    Thank you for your attention to this important and growing national 
issue.
                               __________
Prepared Statement of Scott A. Weisberg, Vice President, Compensation, 
   Benefits and Staffing, General Mills, Inc., Minneapolis, Minnesota
    Thank you Sen. Klobuchar for the opportunity to speak today. And 
thank you distinguished members of the Joint Economic Committee. My 
name is Scott Weisberg and I am Vice President of Compensation, 
Benefits and Staffing at General Mills. We make Cheerios, Green Giant 
vegetables, Progresso soups, Pillsbury baked goods and Yoplait yogurt, 
to name a few of our household brands. We have 28,000 employees--about 
18,000 work in the United States--with annual sales of $12.5 billion.
    I'm particularly glad to be here because the subject of elder care 
has been of interest to General Mills for some time. Back in the 1970s 
and 80s, we recognized there had to be a middle ground between the 
elderly living at home and being moved to a nursing home. Our 
foundation invested in a series of assisted living programs to provide 
both housing and health care for seniors. The result was Altcare, and 
seven alternative senior living facilities, which are still being 
operated today by Volunteers of America.
    Today, I'd like to share why elder care is still important to 
General Mills, how we support employees who are wrestling with work-
life issues, and offer some insight into what employees and employers 
might value in the future.
                           the war for talent
    To understand how we approach this issue, let me start by providing 
some context about our company's employee value proposition and how we 
compete in the ``War for Talent'' in the marketplace. In some ways, 
we're traditional--one of the remaining 18 percent of private employers 
that still offers a defined benefit pension program. We strive to be a 
``cradle-to-grave'' employer, which means we hire many of our employees 
at the entry level and hope they spend their entire career with General 
Mills. We believe this continuity translates into performance and a 
competitive advantage in the marketplace.
    Our benefits package reflects this core philosophy--our benefits 
are imbued with incentives to encourage people to stay. Our defined 
benefit pension program is one of our principal vehicles to reinforce 
employee retention. We also offer a 401(k) program with a company match 
that varies depending on the company's performance, as well as health 
insurance for our retirees.
    This focus on retaining talent is more important than ever because 
the ``War for Talent'' is heating up. In the past, the college 
graduates we hired for entry-level positions were receiving two 
competitive offers, on average (in addition to ours). Today they are 
receiving five offers, on average. And we expect in the near future 
they may be receiving seven or nine offers.
    Another implication of a hot job market is that executive 
recruiters--knowing our reputation for hiring and developing superior 
talent--have targeted General Mills to hire away our employees. We've 
recruited and invested in these employees' development, so it's in our 
interest to retain them. And that's where our philosophies regarding 
employee benefits come into play.
    However, over time we have come to realize that pay, benefits and 
career development alone aren't enough to retain employees. As a 
result, we also offer a variety of work-life policies and programs that 
also help make General Mills a great place to work. We know our 
employees value these programs, and we've been recognized by several 
independent organizations for them:
      ``Best Companies for Working Mothers'' from Working 
Mothers magazine.
      ``100 Best Companies to Work For'' from Fortune magazine.
      ``Best Employers for Healthy Lifestyles'' from the 
National Business Group on Health.
      ``America's Most Admired Companies'' from Fortune 
magazine.
    Going forward, we believe this kind of employee support is only 
going to become more important. That's the context in which I would 
like to focus my comments on elder care. Today, people are living 
longer and that means two things: Our employees will be helping to take 
care of their parents longer and they may also keep working longer to 
ensure they have the resources to provide for themselves and their 
parents.
                    elder care and work-life balance
    General Mills takes a holistic approach to retaining employees 
through its work-life programs (including elder care) and we use three 
basic levers to achieve this goal. We provide employees with:
      Financial support and expert advice
      Time
      A culture of management support
Financial Support and Expert Advice
    The most obvious way to support time-starved employees is to create 
policies and programs to aid them. For example, we have invested in a 
company funded ``Employee Assistance Program'' (EAP) for more than 20 
years. Our EAP provides confidential support through the Internet and a 
toll-free phone line. In the elder care area, some of the services our 
EAP provides include:
      Consultation to employees regarding the care for elders, 
coping with the aging process, communicating with parents and 
understanding Medicare/Medicaid.
      Access to a data base of nearly 100,000 elder care 
providers.
      Personalized search and referrals to adult day services, 
in-home safety assessments, meal and transportation services, 
retirement communities, nursing homes and hospices.
      Training to help employees learn how to anticipate and 
plan for elder care concerns.
    In addition to elder care support, we offer the opportunity for 
employees to purchase long-term care insurance at a discount. Our 
benefits department sorts through the complex labyrinth of providers 
and identifies high-quality vendors so employees can feel confident in 
their selection. And that's another important way we can help.
Time
    The one thing many employees need more than ever before is time. 
Often, when caring for an aging parent, the most important support that 
can be provided is being there--for appointments or to discuss a 
sensitive issue. For this reason, we offer a number of time-off 
benefits for employees, including:
      Three weeks paid vacation in the first year of employment 
and up to 5 weeks of paid vacation, depending on service.
      Flexibility through part-time employment, job-sharing and 
flexible work hours.
      Paid maternity, paternity and adoption leave.
      ``Summer hours,'' which allows employees to take Friday 
afternoons off throughout the summer. Summer hours begin on Memorial 
Day and end on Labor Day.
    Recently, recognizing how much employees value flexibility, we 
adopted two additional types of unpaid time off:
      ``Flex vacation,'' which provides up to two additional 
weeks of vacation per year.
      ``Sabbaticals'' of between four and 12 weeks for 
employees with seven or more years of service.
    When you're employing people for the long haul, it's to be expected 
that work-life issues can occasionally get out of balance. A company's 
commitment to stand by employees through these difficult times enhances 
retention.
A Culture of Management Support
    We all know that even the best policies won't work if they are not 
supported by a company's leadership. I experienced my own version of 
the ``Sandwich Generation'' phenomenon about 6 years ago during one of 
the most demanding periods of the company's recent history: the 
integration of Pillsbury into General Mills. As you can imagine, there 
are a tremendous number of human resource issues associated with such a 
merger.
    At the time, my son was about 15 months old and my wife was logging 
some significant business travel. Further, my father had just been 
diagnosed with cancer and lived 1,500 miles away in California. I was 
fortunate to work for General Mills at the time. We took advantage of 
our EAP to identify a child care provider, as well as refer us to high 
quality elder and hospice care. I also consulted with the General Mills 
company doctor, who helped me navigate the complex healthcare 
environment and coached me on how to ask my father's doctors the 
``right'' questions. Most importantly, I had a supportive boss who knew 
I needed to take time away from the office to attend to my father's 
care.
    My story isn't unique. I know of many others who have similar 
stories. These people are truly grateful for the way General Mills 
supported them during times of personal stress. From an employer's 
point of view, being supportive makes sense. It's not only the right 
thing to do; it builds employee loyalty and has huge retention value.
              the road ahead: employee and employer needs
    While we've focused on how employees provide support for an elderly 
family member, another way to view this issue is to consider how best 
to support employees who are aging and have concerns about their own 
financial and physical well-being. We know that the rising cost of 
health care combined with the fact that people are living longer is 
translating into retirement concerns for Baby Boomers. In fact, a 
recent study indicated that the Number 1 concern of employees who are 
nearing retirement is the rising cost of healthcare. As a result, many 
employees are interested in alternative solutions to supplement their 
retirement income to pay for their medical costs.
    While this could seem like a difficult situation, there is an 
opportunity for a ``win-win'' scenario. Employers have an interest in 
retaining their experienced employees until Generation X and the 
Millennials acquire enough expertise to replace them. Companies like 
General Mills would like to offer more flexibility as it relates to 
``phased retirements,'' which would allow employees to collect some of 
their retirement benefits while still working. As things stand today, 
there are some small barriers that make this difficult.
    Under current regulations, our employees are prohibited from 
working for us while collecting pension benefits. They can, however, 
work for another employer and draw their General Mills pension. We'd 
like to see this current system modified so that if employees wanted to 
phase into retirement, they could ``phase into'' receiving a share of 
the pension they had accrued with us. This would allow our employees a 
chance to supplement their income by applying the wisdom they gained at 
the same place in which they've spent their careers. We believe that 
this would be good for employees and, of course, is good for a company 
like ours.
    Second, is a small modification in the law related to Health 
Savings Accounts (HSAs), which allow employees to set aside money on a 
tax-favored basis to pay for current and future healthcare expenses. At 
General Mills, we would like to allow our employees to take advantage 
of HSAs, but under current legislation, we are ineligible to provide 
one because we have a company health clinic. The in-house clinic allows 
employees the convenience of using preventative onsite services on a 
voluntary basis. As a self-insured employer, we believe these 
preventative services are delivered in a cost-effective manner and may 
save the company from larger costs down the road. By providing more 
flexibility in the rules for HSAs, it is our view that we may be able 
to address some current concerns employees have regarding the rising 
cost of healthcare.
                               conclusion
    It's clear that elder care is only going to become more important 
as our population ages. Most of us are going to have to deal with this 
issue at some point in our lives. We see providing employees with the 
information--and the time--to navigate through this period of their 
lives as a key retention strategy for General Mills.
    In the future, I believe that it will behoove all employers to 
recognize the importance of elder care--as well as other work-life 
balance issues--if they are going to be the winners in the War for 
Talent.
    Thank you for the opportunity to appear before you today. I would 
be happy to answer any questions that you have.
  

                                  
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