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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