Financial Answers "IN SIMPLE LANGUAGE"

We have been hearing a lot lately about health care reform.  President Obama and some members of congress were recently on television trying to agree on parts of the democratic health care bill…consisting of some 2600 or so pages.

I watched this “performance” for about two hours and finally had enough.  Neither democrats nor republicans appeared to want to give an inch in getting some type of health care bill passed.

Hopefully they will get their act together and get something done and soon.  We all understand the importance of the spiraling cost of health care.  Yet I do not hear anything about the hidden tidal wave that is rolling towards the 76 million baby boomers in the United States.  Isn’t this what we were just talking about? No!

Long Term Care

What I am talking about is not health care for boomers, which is Medicare.  What I am talking about is long term care, such as Medicaid, for boomers and many others.  They are different and separate.  Let me repeat that. Health care for boomers-Medicare, and long term care for boomers-Medicaid, are different.

An online poll done in October, 2009 with 1,000 Americans surveyed showed that only 10% would use long term care insurance to take care of their long term care needs.  Long term care needs are bathing, dressing, continence, eating, toileting, and transferring or commonly referred to as the activities of daily living.  Mental impairment would also be included.

Almost 25% of those surveyed said they were going to rely on family and friends to help with their long term care needs.  Another part of the survey said they would use their savings and social security to pay for their long term care needs.

Which program should I use?

Close to 20% of the people surveyed thought that they would use Medicare, which is a health insurance program and not long term care, to take care of their long term care issues.  Medicare provides some initial long term care but only if certain conditions are met and only for a specific period of time.  Mostly you are on your own.

What about Medicaid?  If you are destitute you may qualify under your state’s Medicaid program…although many states are having a difficult and sometimes impossible time maintaining their Medicaid programs.

 Some people surveyed mistakenly think that they private health insurance policies will cover their long term care needs.  There is a lot of confusion among the American public.

 Costs of Long Term Care

Now you may say to yourself that you will worry about long term care if and when it occurs.  Statistically one out of two people over the age of 65 will need some kind of long term care help.  As I have mentioned in previous blog posts, my brother, who passed away in January, 2009, was under long term care for almost five years.  If he didn’t have military service and wasn’t covered by the Veterans Administration, his widow may have suffered enormous financial problems.

No one is immune from long term care.  It can wipe out all of your assets in a very short period of time.  The median annual cost of a private room in a “nursing home” is estimated to be just under $75,000. 

So you say you are not going to go to a nursing home.  The median annual cost of “home care” with a certified Medicare home health aid is over $105,000 annually.  So you say to yourself that you don’t need anything fancy and don’t need a lot of home care.  The average median annual cost of just basic home long term care is slightly less than $39,000 per year.  How long will it take to wipe you out?

I have often heard this one.  These costs are exaggerated and my spouse or children will take care of me.  Is your 95 pound spouse going to lift your 230 pound body in and out of the bathtub or on and off the toilet?  Do you want your son or daughter giving you a bath because your spouse can’t handle you?  These are not things I am making up.  These are things that I saw and did with my brother, who by the way, lived 600 miles away from me.  I could only help when I came to visit.

I am trying to scare you into realizing that long term care is a very serious issue that is not being addressed enough in this country… I don’t know about other countries.  Contact your state’s department of insurance and request information on long term care and get information from your local insurance agent.  Educate yourself today.  Don’t wait until it is too late and you can’t qualify for long term care.

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