A recent California study projects “an unprecedented senior tsunami” led by 65 – 84 year old baby boomers. This group will swell nursing home residency to more than double current levels in just over 15 years.
The findings by the UC-Berkley study paint a dire picture for California by 2030, when the state’s Medi-Cal Long Term Care (LTC) costs are expected to soar to $12.4 billion annually. This is an 88% increase from current government spending for institutional LTC.
It does not help that rising levels of obesity are expected to exacerbate seniors’ health problems. Obesity often leads to diabetes, and people with diabetes have a significantly higher incidence of Alzheimer’s disease.
Couple this with a recent Pew Research study that states people in the United States are much more likely to say that seniors should be responsible for their own care than people in other countries. I find that surprising when one considers the number of people who attempt to hide assets to collect Medicaid.
Others say they plan to move in with their children, but most have not conveyed that plan to those children. Ozzie and Harriet were a typical 50’s couple where the wife stayed home while dad went to work. In her dress, heels and pearl necklace she had the time, space, and energy to have parents move in when they needed care. Today most wives are working just as many hours as the husbands and have little resources to provide 24 hour care to elders.
The government itself is short on funds, you may have heard rumors of budget deficits in the news. 29 states and Puerto Rico have filial responsibility laws on the books. These laws can force children who are above the median income of their state to be held legally responsible for parents’ bills. They have not been enforced, until recent court case decisions in two states.
No one knows whether these recent court cases will encourage other states to enforce their filial support laws with greater vigor, but this is a development worth watching. However, as more of the Baby Boomer generation reaches their golden years, and as many nursing homes and local governments are faced with providing care to a growing number of indigent elderly patients, there’s a possibility that other states will look more closely at their filial support statutes in an attempt to find another way to fund mom’s or dad’s nursing home bill.
There are basically three ways to pay for care if you cannot move in with your children: pay for care until you are impoverished, apply for Medicaid when you are impoverished, or plan ahead and purchase LTC insurance while you are healthy enough to purchase it. Insurance is the least expensive option, but if you wait until your health changes or your doctor has handed you a diagnosis of a medical condition that precludes your qualifying to purchase it, you are left with no choice but to spend down a life’s savings. Have you even investigated this insurance? Perhaps it’s time.