On March 7, 2013, the Jewish Herald-Voice reported on a potential tragedy.

In Houston, Malcomn Slatko, CEO of Seven Acres Nursing Home, and George Linial, president and CEO of LeadingAge Texas, an association of not-for-profit long-term care facilities, held a press conference to inform the public about the financial peril they face due to shortfalls in Medicaid funding.

The article reports that funding for Medicaid in Texas is the 49th lowest rate nationally. There is a big disparity between the cost of caring for Medicaid-paid nursing home patients and the true cost of caring for them. According to the Texas Department of Health and Human Services, the average Medicaid payment per patient is 17% lower than the actual cost of providing quality care for them.

85% of Seven Acres residents do not own long-term care insurance (LTCi), have exhausted their savings, and are on Medicaid.

To make matters worse, today’s nursing home resident is admitted sicker, frailer, and more needy than in years past.

Like Seven Acres, more and more nursing homes operate in the red.  The article reports the inevitable result – there have already been nursing home closings.

When people have the money long-term care insurance provides to pay for care, they are often able to avoid nursing homes and get care instead at home or in good assisted-living facilities.

Nursing homes are not where anyone would choose to receive long-term care. Yet, if you refuse to plan for long-term care responsibly in advance, you might wind up in one.