Many people don’t realize that, in addition to traditional health care, Medicaid actually pays for most long-term care (LTC) in the United States. In fact, less than 40% of Medicaid dollars are used to pay for traditional health care. The small portion of Medicaid recipients (just over 20%) whose long-term care services are paid for by Medicaid use over 60% of the Medicaid budget dollars.
Most assisted living facilities don’t accept Medicaid, so often Medicaid recipients needing LTC are left with only one choice—a nursing home. This is because the federal government requires nursing homes to accept Medicaid payments if they want to accept Medicare for the rehab care they provide–and this rehab care is a major source of revenue for many nursing homes.
Wouldn’t you rather receive care, when needed, at home or in an assisted living facility rather than the nursing home? Most people would, but if you cannot afford this care – your only option might be the nursing home.
Many people mistakenly assume LTC insurance is too expensive. It can be, if it’s not chosen appropriately. Do you have a deductible on your car insurance or does it cover every last penny? Mine has a deductible, so that I pay the first part and insurance pays the expensive part.
LTC is similar. Your lifestyle will change when care is needed. You will spend less money on vehicles if you cannot drive, and spend less on golf, travel, toys, and so on. The money freed up by not spending it on these things needs to be taken into account in order to see how much care you can pay for. Then you only need enough insurance to cover the shortfall. If you have a nest egg, and do not want to use it all up, you can always take the interest it generates to help lower the insurance need even more—and never touching the principal.
Think you cannot get LTC insurance because of health? I have solutions for nearly every situation – even some for people already in care.
So, you can ignore this and hope you will not be among the 70% of us who will need care – or you can investigate options to see if this concern can be handled affordably. Your choice!
www.TheLongTermCareGuy.com Romeo Raabe is here to help, even with just advice.