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POLICY: Should Medicaid come after your inheritance to pay for grandpa’s LTC? by Eric Novack

THCB’s favorite surgeon is back with an interesting question on Medicaid “lookbacks”, and who should pay for long term care. Eric Novack writes:

In today’s Boston Globe, there is an article titled Medicaid proposal could hurt seniors. In it the Globe reporter makes the claim, along with help from representatives from the AARP, that “people who gave money to their church or helped a family member — are going to find themselves in trouble”.

This is ostensibly because of new rules that will be more stringent about examining a person’s assets when determining Medicaid eligibility. A 94 year old man in the article is quoted as saying, “[y]ou go into a nursing home and they take all the money”. In his case, he wanted to be able to pass on enough money to help care for his daughter.  This asks the question of who, then, is responsible for taking care of him?  Many on this site clamor for ‘universal coverage’ with ‘global budgets’.

I am interested in hearing who they think should be responsible? Is planning for the final years of life no longer the responsibility of the individual? Should retirement planning not have to include any provisions for illness or infirmity? Is it the responsibility of other citizens children and grandchildren to be taxed to provide care when people have assets in their homes and retirement accounts? The baby boom generation is booming, with hundreds of people reaching 60 years of age each day. This group has trillions in net worth. Even if housing prices do not continue to increase- or even decline slightly- many have hundreds of thousands of dollars of equity in their homes.  Most, hopefully, will live healthy, productive lives for 30 or 40 more years. Most will incur significant healthcare costs over that time.  Recent estimates are that people retiring today need to anticipate about $190,000 in healthcare expenses.  The article makes the claim that a recent KFF study reported that, on average, only $8200 was transferred. $8200 times the millions on medicaid is quite a lot of money (over $8 BILLION per million). Should we not expect that those who will utilize the services be expected to use their assets to pay for their care?

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louJim SPeterJessica sterlingPeter C Recent comment authors
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lou
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lou

My 92 year old mother is in a nursing home, and my sister and I visit her everyday. Her dimentia is significant. She owns no property, but has some money saved. If she lives for another 5-6 years her money will run out. She and our father (now deceased) were very proud of their savings and particularly wanted the money to go to their 2 daughters and their grandchildren. Our number one concern is our mother level of care. The nursing home is good and we pay for sitters 3 hours every day. My sister’s name and my name are… Read more »

Jim S
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Jim S

One more article I wrote – Now I will await some responses. Basic Solutions to Affordable Healthcare The healthcare crisis has a solution that is the most fair to the majority of the society. In order to implement such a system it will now take very tough, near zero tolerance attitudes along with direct action by the people to force it into action. We have been complacently tolerating an almost hopelessly complex and greedy healthcare system as it has gradually eroded our pocketbooks and quality of life (For those fortunate enough to have access to the latest and greatest medical… Read more »

Jim S
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Jim S

More Opinion: A response to my local newspaper: With thousands of people around this area (central PA) earning in the $5.50-7.50 an hour range including many well educated adults I don’t think nurses are suffering in the slightest as they earn in the $15-30 an hour range depending on experience and overtime. The nursing shortage is largely due to the job simply being very demanding, having too many patients per nurse, and around the clock shifts being required. And only so many people are cut out to be a nurse dealing with the most personal care of other human bodies.… Read more »

Jim S
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Jim S

Health Insurance Opinions Subject: This is not Right! We all can quickly think of many problems with the health care system but in most cases, as individuals, there seems to be little we can do to stop the giant ball of endless bureaucracy and greed from continuing to tumble down the mountain, other than to stay healthy and not use the system, to a presently unknown, though likely disastrous conclusion. However, I have one way that many people can fight back by doing what is right. It has come more and more to my attention that those who pay for… Read more »

Jim S
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Jim S

We as a society have permitted the healthcare system to get completely out of control. I am many others only take home a bit over $1,000 a month – I very deliberately choose to not accept employer provided health insurance and instead build my retirement. Thanks to me and my wife making this choice over 24 years (I estimate this amount would equal about $300,000 including what such money would be worth invested in a stock mutual fund at 10% a year) we now have a nice home paid for, have raised a child for 17 years, have almost $300K… Read more »

Peter
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Peter

I don’t agree. This situation exists with lawyers, do they compete through price for your business. Who can really afford a lawyer for a “catastophic” legal requirement. Ever try to price negotiate with a lawyer? Lawyers and doctors have industry pricing guide lines and do not want to compete on “price”.

Jessica sterling
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Jessica sterling

Here is an easy solution to the healthcare crisis in our country. Pass a law that makes it illegal for people to have any kind of health insurance except for hospital, surgery, long term physical therapy, and long term care. In this way real competetion from, doctors, clinics, specialtists would come into play. All accounts would then go into a cash basis. Which means doctors would be vying for your attention. Competetion for your dollar would be stiff, and that drastically bring down the cost of any visit to the doctor. The same thing would happen to prescription costs. Drug… Read more »

Peter C
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Peter C

I think the first thing we should ask ourselves is are we willing, as a society, to put old sick people on the street for the inability to afford humane care. If your answer is yes then there is no futher discussion. If your answer is no then we do need some ground rules. My 86 year old mother living in Canada, who recently died, was looked after in a nursing home for the last 5 years. Her government pension and Old Age Security were her only income. Both of these checks were turned over to the nursing home to… Read more »

Lin M, MA
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Lin M, MA

The problem is the cost of nursing home care and seniors not being aware that any “gifts” they give to their children, grandchildren or charities will disqualify them for nursing home care when they really need it. Example: Retired minister, age 86 falls and breaks his hip, then has a heart attack, and requires nursing home care. Has felt it his duty to give to charities and to tythe to his church, all count as “gifts”, but he can’t get them back. He had a caregiver for the past three years, and paid her $1,000 a month but didn’t give… Read more »

Lin
Guest
Lin

Mother had to be placed in Nursing home. She lived on her Social Security and she did own her home…Also she does not even have enough of life insurance for a decent burial….Is there any way her home can be sold and money saved for burial, keep her ins. paid and things she needs till she dies………I’m asking for information….Can anyone help………….She was living in poverty as for what she received & had……. Yes she was placed on Medicaid to go in Nursing home… Thanks, Lin from Georgia

T. Coppotelli
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T. Coppotelli

So what you are saying is “yes, we should have a national healthcare plan, but, if people have homes to live in they should get rid of those first?” Where exactly do you expect these “baby boomers” to live while they are using their shelter to pay for their health care? Healthcare expenses are too high. The first thing that should be done is to reform all the waste generated from hospital and physician financial gain incentives. The more tests or procedures that are done the more money each makes. Even if mistakes are made. There are too many duplicate… Read more »

TW
Guest
TW

I think Eric’s point is that, while most people have nowhere near that much in cash or liquid assets, a lot of people have that much in home equity. And while all of us want to leave as much as we can for our children, we should first take care of our own expenses. I’m a strong believer in national health care, but it’s not fair or efficient for people to preserve their assets & enrich their heirs by dumping their long-term care costs onto the Medicaid program, where the costs of that care inevitably squeeze out basic coverage for… Read more »

Kevin Davidson
Guest

“Recent estimates are that people retiring today need to anticipate about $190,000 in healthcare expenses.”
I think the question is not so much “who is responsible?”, as “who has that kind of money?” It’s difficult to plan for medical expenses when illness is so random. The only way we can reasonably address the issue is through shared risk. Shared risk means insurance, either private or public.
The root problem is that health care costs are out of control.