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Why Are We Willing To Discuss Fixing Social Security & Medicare, But Not Medicaid?

December 10, 2012 by Honey Leave a Comment

In his November 15, 2012 New York Times editorial, Paul Krugman demonstrates again that neither party is addressing the changes that will be truly necessary to curb growing budget deficits.

The only solutions to Medicare and Medicaid’s skyrocketing budgets that I’ve seen recommended are lowering Medicare and Medicaid reimbursements, and increasing Medicare eligibility ages. These are merely band-aid solutions.

Neither party is willing to address the hard changes that will be necessary to remove Medicaid from its economically dire predicament. I address this in my blogs Medicaid in deep trouble, no matter who wins the election and Neither party has a solution for the oncoming deluge of Medicare/Medicaid services.

For one thing, Medicare and especially Medicaid are complicated programs that most legislators and the public do not understand well. Furthermore, many of the most intelligent people I meet appear to suffer from resistance to discussing depressing sounding future events, such as planning for their elder years. And, tragically, this lack of planning frequently has dire consequences. More specifically, we know conclusively that very few middle-class Americans have done responsible long-term care planning.

Mr. Krugman argues, and I agree, that raising eligibility requirements for collecting Social Security and qualifying for Medicaid is needlessly cruel and would be hardest on our most vulnerable citizens – those who work in physically demanding jobs for little pay. And these changes would have little impact on the bottom line because those who depend the most on Social Security will not live as long as more affluent Americans since longer life spans are related to education and income levels. Raising the Medicare eligibility age a couple of years will also save the federal government little because seniors in their mid-to-late 60’s generally have decent health and cost Medicare far less than the very old.

Readers will note that few pundits write about how to fix Medicaid, nor do legislators approach Medicaid reform. Medicaid is our most expensive and threatened entitlement program. It is Medicaid-paid long-term care that will cause the most catastrophic budget shortfalls as the Baby Boomers continue to age.

Neither Party Has A Solution For The Oncoming Deluge of Medicare/Medicaid Services

September 25, 2012 by Honey Leave a Comment

I was happy to see in Steven Rattner’s September 16, 2012 New York Times Op-Ed column at least a faint acknowledgement of a looming catastrophe. Because of its highly unsavory political nature, neither Democrats or Republicans really want to address the oncoming deluge of aging Americans who will further glut our already hobbled Medicare and Medicaid programs.

Mr. Rattner sticks to describing Medicare in his peice, although he does refer to the oncoming deluge of ill-prepared aging parents who will need long-term care.

Politicians are even less inclined to discuss Medicaid, which pays for more than half of all long-term care in the US. However, I have recently blogged about Medicaid’s bleak future, no matter which party wins the election.

Medicaid payments affect the quality of Medicaid-paid long-term care. Medicaid-paid nursing homes count on Medicare covered expenses to offset the money they lose on every Medicaid patient.

In past blogs I have explained why budget shortfalls make Medicaid-paid long-term care inferior in many regards. With this knowledge, why aren’t more people motivated to act responsibly and protect themselves and families against the high costs, high risks of needing long-term care? This remains a mystery to me. Reasonably priced long-term care insurance is still the cheapest way to access and pay for the long-term care options people want, and that are preferable to Medicaid-paid care.

I’ve added the bolded type below, for emphasis.

Mr. Rattner writes, “The Obama and Ryan plans are not without common ground; both propose an identical formula for capping the growth in Medicare spending per beneficiary. And both dip into the same toolbox (particularly lower payments to providers) to achieve a reduction of nearly $1 trillion in Medicare expenditures over the next decade from projected levels.”

“Mr. Ryan believes that meeting the goal over the long term requires introducing more competition into Medicare through vouchers to purchase private insurance. But Ryan’s approach was rendered toothless when the issue’s brutal politics forced him to retreat from his initial tough plan to simply cap the growth in government spending on Medicare and stick the inevitable overage onto beneficiaries. Under his revised plan, private insurers would be required to offer the same level of benefits as traditional Medicare, meaning that any savings would have to come from unidentified efficiencies (the ever-popular “waste, fraud and abuse”).”

“To be sure, health care cost increases have moderated, in part because of the recession and in part because Medicare has been tightening its reimbursements. But those thumbscrews can’t be tightened forever; Medicare reimbursement rates are already well below those of private providers.”

Mr. Rattner concludes, “the Independent Payment Advisory Board should be allowed to offer changes in services and costs. We may shrink from such stomach-wrenching choices, but they are inescapable.”

Government-paid long-term care will get worse before it gets better. Be forewarned with this knowledge and act accordingly and responsibly. If you want to be assured greater dignity and options, buy reasonably priced long-term care insurance NOW!

Children of Aging Parents Often Nearby

September 21, 2012 by Honey Leave a Comment

In her New Old Age article (“Children of Aging Parents Are Often Nearby, Study Finds,” New York Times, September 14, 2012), Paula Span reports on a new study by Michal Engelman, a University of Chicago gerontologist. In his study, Dr. Engelman gives insight into why parents move closer to their children as they age.

He found that people who own long-term care insurance (LTCi) are less likely to move closer to their children, apparently because “it shows potentially less need for family care. If they need more help, they’ll be able to get it.”

Here is additional proof that owning LTCi gives people options and increases independence. LTCi ownership reduces stress and burden to family members.

Medicaid is in Deep Trouble, No Matter Which Party Wins the Election

September 7, 2012 by Honey Leave a Comment

A great front page New York Times story came out Sept 7, 2012 by Nina Bernstein, called “With Medicaid, Cost of Long-Term Care Looms as a Rising Cost”.

The gist of this article is that no matter which party wins the election, hold on to your hats concerning Medicaid, which pays for about half of the cost of long-term care, nationwide. Medicaid is going to erode. It is eroding. It has eroded. Due to slashed reimbursements and broad middle-class access, Medicaid is already the last choice if home health care or assisted living are feasible instead.

I’ve pasted some quotes from the article, below.

“With baby boomers and their parents living longer than ever, few families can count on their own money to go the distance.”

“Many people mistakenly assume that Medicare will cover long-term care, but at most it covers 100 days of rehabilitation, not so-called custodial care — the help with activities of daily life, like eating and bathing, that the aged can need for years.”

(It should already be clear to readers of this blog that Medicare can’t, and won’t pay for long-term care. Only reasonably priced long-term care insurance or personal savings and sacrifice pay for the more dignified options people prefer.)

“More than $80,000 a year on average for a nursing home — who can sustain that?” said Robyn Grant, director of public policy and advocacy for the National Consumer Voice for Quality Long Term Care. “We’re forced, most of us, to go onto Medicaid. People don’t realize this.”” (I inject that many people are not forced to go on Medicaid unless they’ve failed to make responsible – and reasonable – plans for long-term care in advance.)

“While Medicare has drawn more attention in the election campaign, seniors and their families may have even more at stake in the future of Medicaid changes — those proposed, and others already under way…The presidential election may decide Medicaid’s future. But many states faced with rising Medicaid costs and budget deficits are already trying to cut the cost of long-term care by profoundly changing Medicaid coverage, through the use of federal waivers.”

“Medicaid spends just under a third of its budget paying for long-term care for the disabled and elderly in nursing homes; this is more than five times as much as it spends on each poor child.”

The article goes into more detail on the different techniques states are using to try to trim their Medicaid budgets. It is my opinion that none of the proposed changes will improve the quality of Medicaid-paid long-term care; they will just shift around costs and add instability to this already strained program.

The bottom line is that the government cannot afford to provide decent long-term care. With the looming “Silver Tsunami” of Baby Boomers who are going to deluge it, the quality of Medicaid-paid long-term care is likely to continue to deteriorate. Counting on the government to pay for long-term care is foolhardy.

This article excellently describes Medicaid’s crisis and why it is ill-equipped to pay for long-term care. What it doesn’t even touch on is the fact that Medicaid-paid long-term care facilities are already the bleakest and scariest places to receive care. People do not choose Medicaid-paid long-term care. They default to Medicaid because they have no other options. And the real tragedy is that vast majority of American could have avoided this fate, but they denied that they would EVER need long-term care and therefore failed to take action before it was too late.

Families’ Resources for Financing Long-term Care (LTC) Have Declined Precipitously

June 21, 2012 by Honey Leave a Comment

According to “Family Net Worth Drops to Level of Early ’90s, Fed Says” (New York Times, June 12, 2012), the median American family’s net worth in 2010 has dropped to its level in the early 1990s – a 40% reduction from $126,400 in 2007 to $77,300 in 2010! Three quarters of the drop was caused by the crash in housing prices so although we may regain a portion of our losses, it will likely be many years before we climb back up to the 2007 figure in real dollars.

Furthermore, median income also declined from $49,600 to $45,800 during the same period. So Americans are earning less and have far less in reserve, thanks to the catastrophic recession beginning in 2007.

What does this mean for the 75% of Americans who will need LTC after they reach age 65? Even though they may be struggling to make ends meet in these hard times, they had better budget for reasonably priced LTC insurance premiums NOW to ensure options, dignity & choices in accessing the care they need. Otherwise, they may find themselves bankrupt and marooned in a Medicaid nursing home.

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Neither Party Has A Solution For The Oncoming Deluge of Medicare/Medicaid Services

Children of Aging Parents Often Nearby

Medicaid is in Deep Trouble, No Matter Which Party Wins the Election

Families’ Resources for Financing Long-term Care (LTC) Have Declined Precipitously

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