Long-term care costs leave medicaid as the option

If you are not familiar with the term "long-term care," you probably will be soon. Over 10 million people in the U.S. need long-term care today. That number, while shockingly large, is increasing by the day. Use of long-term care is projected to double between 2000 and 2040.

Of these 10 million people who currently need long-term care, 86% receive services in their community and 14% live in nursing homes. Neither care in the community nor care in a nursing home is cheap. The cost of a nursing home stay is quite astounding. Rates are charged daily, much like a hotel. The average cost of a nursing home stay in 2009 was $70,000 per year. Some states are, of course, more pricey than others. The Midwest is significantly less expensive than the coasts, for example. The average cost of a nursing home stay in Missouri is closer to $50,000. Given this data regarding the high cost of a year's stay in a nursing home, it is hardly surprising that two-thirds of older people in the community indicate that they would be unable to pay for even one year of nursing home care.

A substantial portion of older Americans turn to Medicaid to pay for their long-term care. In deed, Medicaid currently pays for approximately half of all nursing home care costs. Qualifying for medicaid is rather straight forward, but daunting: reduce your assets down to $2000 in most states, or $999 in Missouri. Reducing one's assets to $999 translates into impoverishment. There are planning techniques to assist older Americans as they face this challenge. Planning can help avoid bumps and hurdles. The situation of each individual is unique. Become informed. Attend seminars and learn how you can best preserve your assets.

For more detailed information related to the above statistics, see the article from the NAELA JOURNAL - National Academy of Elder Law Attorneys* Volume 5* 2009* Number 2 - entitled "Future Challenges Facing Medicaid's Role As A Provider Of Long-Term Care," by Molly O'Malley Watts, MPP, Judith Kasper, PHD, and Barbara Lyons, PHD.

Written by
Samantha Shepherd, JD
LL.M Estate Planning