Challenges of caregiving can weigh a small business down

By ALAN GOFORTH

Small-business owners have enough on their hands dealing with an ailing economy without worrying about the potential impact of a long-term illness to a spouse or close relative.

“When you are a small business, you have a lot of balls in the air,” said Mary McCormick, managing partner at McCormick & Fracassa PC in Liberty, which focuses on elder and special-needs

law. “But sickness or old age can kind of sneak up on you”

Rudy Yanez, owner

of Rudy’s Portraits of Style & Design in Platte City, learned that lesson the hard way when his wife, Karen, was diagnosed with multiple sclerosis.

“My business suffered for two years because of lost productivity and lack of attention,” he said. “The message I have for anyone who owns a small business is to be aware. You may think you have enough money set aside to cover long-term care, but you probably don’t. It can cost $8,000 to $10,000 a month for a care facility. There is no way an average person can survive that and stay in business.”

Shirley Boston-Otis, owner of Boston-Otis Insurance in Lee’s Summit, found herself in a similar situation five years ago when she learned that her husband had Parkinson’s disease. Although she had long-term care insurance, her major concern was her clients.

“What I learned is that it’s very hard to run a business and take care of someone who needs a lot of care,” she said.

Yanez and Boston-Otis found workable solutions, but not without a number of challenges along the way. They encourage other owners to think about the economic impact of caregiving before the need arises.

Missouri has 590,000 caregivers at any one time, with an economic value of $7.1 billion, according to AARP. Kansas has 270,000 caregivers, with a value of $2.7 billion.

“Think about the time and energy it takes to run a small business and the focus to make it successful,” McCormick said. “That focus is diverted if a partner or spouse becomes ill and requires time that would have been devoted to the business.”

Just as with other types of asset protection, a little planning can go a long way. “The toughest challenge is education and making people aware of what types of services are out there,” she said.

A good starting point is to identify which employees are essential to the profitable operation of the company.

“As a business owner, I would cross-train my employees,” McCormick said. “If a key employee has to be out and someone is familiar with their job, it makes things a little easier.”

Consider making long-term care insurance a part of the benefits package for the owners and other key employees. Boston-Otis and her husband purchased this type of insurance two decades ago and assumed they would never need it. Yanez wishes he had done the same.

“Long-term care insurance is an option, but it was too late for me, because my wife had a pre-existing condition,” he said. “And because I’m in my 50s, the premium would have been expensive.”

It also can pay to seek expert legal advice and other professional services.

McCormick recommends the National Academy of Elder Law Attorneys ( www.naela.org) as a resource.

Yanez hired an attorney.

“Legal services come with a price, but what is there of value that doesn’t?” he said. “They kept me from going bankrupt.”

Timing also is important. The best — and most economical — time to plan is when things are going well, but that’s not always possible.