Medicaid and Long-Term Care 

We discuss Medicaid and Long-Term Care benefits. Please note, we are not talking about Medicare, which is health insurance for everybody upon reaching age 65. Our discussion is relating to taking care of our personal needs. Eating, dressing, bathing, toileting and moving about. As we age, our ability to service our personal needs often becomes impaired. When this happens, we find ourselves in a position to impose on our children, our relatives, our friends or anybody else who is willing to help. There comes a point in everyone’s life that they will need assistance.

Before addressing the questions, let us address the statistics:

• 52% of people turning 65 will need some type of long-term care in their lifetime, for a man the average long-term care is 1 ½ years and for a woman it is 2 ½ years
• 14% of the population over 65 will need long-term care for more than five years
• 10% of Americans over 65 have Alzheimer’s or dementia
• 33% of Americans over age 85 Alzheimer’s or dementia
• 64% of Americans with Alzheimer’s are women
• There has been 123% increase in the number of people that died from Alzheimer’s between 2000 and 2015

Caregivers:

• 34.2 million Americans have provided unpaid care to adults 50 years of age or older in the last 12 months
• 16.41 million care for someone with Alzheimer’s
• $470 billion is the estimated value of prepaid long-term care in 2013
• $30 billion of long-term care costs in the year 2000
• $225 billion of long-term care costs in 2015
• $1.7 trillion of long-term care cost in 2020 next year
• Note the average household income for someone 65 or older in the United States is $39,000 a year.

Nursing home cost:

• $85,775 semiprivate room in 2017
• $215,770 private room in Manhattan in 2017. Individual income from someone 65 or older in 2017 was $23,394.
• Who pays for long-term care:
• The Medicaid program is administered and funded by the state. 51% of all long-term care services were paid by states
• 20% of services were paid through public sources other than the state
• 62% of nursing home residents care is provided by Medicaid
• Assets retained by a spouse and their partner receives Medicaid $123,600 in 2018
• $3090 monthly income allowed

The Long-Term Care Insurance industry:

• In 2000, there were 125 companies offering Long-Term Care Insurance
• In 2014, there were 15 companies offering Long-Term Care Insurance
• 380,000 Long-Term Care Insurance policies were sold in 1990
•  72,736 Long-Term Care Insurance policies were sold in 2009
• 4,500,000 baby boomers with Long-Term Care Insurance
• There are 75,000,000 baby boomers, 6% have Long-Term Care Insurance

10 things to know about Medicaid

1. Medicaid is a cost-efficient program providing living cost coverage for low income Americans.
2. Medicaid both boost and boasters the private insurance market by acting as a high-risk pool.
3. Federal Medicaid matches funds and supports states ability to meet changing coverage needs such as during economic downturns and public health emergencies.
4. Medicaid is the major spending item in a state’s budget, federal government matches much of the state spending. Medicare and Medicaid together are the largest Federal Government expenditures.
5. States have broad discretion in designing key aspects of their Medicaid programs.
6. Medicaid beneficiaries have robust access to care overall although access to certain types of specialist is an ongoing challenge for Medicaid and all payers.
7. Medicaid keeps coverage and care affordable for low income Americans.
8. Evidence of Medicaid’s importance on health outcome is growth.
9. Medicaid is a primary payer of long-term care for seniors and people with disabilities.
10. Medicaid is popular with the American public as well as with enrollees themselves.

Each of us personally and in our family will confront the need for Long-Term Care provisions at some point in our life. Meet with your planning advisor and look at the options to arrange your affairs in a fashion that will maximize the care for your family members and potentially leave room for you to have a satisfying retirement.