If you are planning ahead for your retirement years and the twilight years that will follow, it may be hard to imagine a time when you will need living assistance. This is understandable, but when you look at lifespans, if you are fortunate enough to live until you are 67, your life expectancy is at least 85 years of age. At that point, things can be considerably different than they were when you first started to receive Social Security benefits.
In fact, the United States Census Bureau has done some research that sheds a lot of light on the matter of aging in our country. Censuses are conducted every 10 years, and the information that is compiled is utilized to measure various different demographic trends.
According to research that was done by this agency, between the years 2000 and 2010, the ten-year age group that was between 85 and 94 years old grew faster than any other segment of the population. These individuals are referred to as “the oldest old” in geriatric circles. Unfortunately, when you enter this stage of your life, Alzheimer’s disease becomes a very real threat.
The Alzheimer’s Association is a veritable treasure trove of information about this disease, and you should certainly check out their website if you are interested in educating yourself. According to this highly respected entity, approximately 40 percent of people that are defined as the oldest old have contracted Alzheimer’s. If you include all Americans that are 65 years of age and older, the figure is a rather eye-catching 13 percent.
Nursing Home Care
If you pay into the program sufficiently throughout your working career, under currently existing laws, you will qualify for Medicare coverage when you reach the age of 65. There are out-of-pocket costs including co-payments, deductibles, and premiums, but under most circumstances, they are manageable. However, there is a huge gap that impacts a very significant percentage of senior citizens eventually.
It would be logical to assume that the Medicare program would pay for long-term care for elders, since it exists to address the medical needs of older Americans. Though it may not make sense to a lot of people, Medicare will not pay for a stay in a nursing home. The type of care that is received in a facility such as this would be looked upon as custodial care, and Medicare will not pay for this form of assistance.
Obviously, many people that contract Alzheimer’s disease late in their lives require the level of care that can only be received in a nursing home. Genworth Financial exerts a lot of effort to keep a finger on the pulse of the state of long-term care costs in the United States. They produce national figures, and they also drill down state-by-state and city-by-city.
Our firm is located in Mount Clemens, Michigan, which is about a 30 minute drive from Detroit. In this area, the median monthly cost for a private room in a nursing home is $8608 at the time of this writing. If you multiply this by 12, you are looking at an annual expense of just over $103,296. You would not be saving very much if you sacrifice some privacy and settle for a semiprivate room, because the annual cost would be $95,628.
Medicaid is a jointly run federal/state government program that provides health insurance for people with very limited financial resources. It will pay for long-term care if you can obtain eligibility, but there is a $2000 limit on assets. Your first thought may be that you could never qualify because you have resources that exceed this amount, but some things are not counted, including your home (though there is an equity limit of $572,000).
When it comes to the assets that are countable, you could engage in a process called a Medicaid spend down. This can involve giving gifts to your loved ones who would otherwise be inheriting them after you pass away. To do this effectively, you must plan ahead carefully, because you are penalized and your eligibility is delayed if you give away assets within five years of applying for Medicaid coverage.
Schedule a Consultation Today!
We are here to help if you would like to discuss Medicaid planning as a response to the costs associated with memory care. You can set up a consultation if you call us at 586-493-7661, and you also have the option of sending us a message through the contact page on this website.