We’ve been getting some questions as a result of my quotes in the Post Gazette a few times in the last month. The Post Gazette is doing a wonderful job covering the many challenges in the long term care world in our region, including the nursing homes. What is happening in the Nursing Home industry is causing red lights to flash. There are things to be concerned about and I think it’s important to discuss them. I also want to share tips on how to protect yourself.
No-one wants to go broke in a nursing home, and no-one really wants to pay a nursing home $15,000 a month. However, I’ll rush to add that nursing homes are there because we need them. The owners of most nursing homes are good people, as well as the people who work in nursing homes who are dedicated to helping those in need. After the pandemic, it would take an angel to want to work in a nursing home, taking care of somebody. I have respect for the healthcare workers who are fighting this good battle every day. Thank you for what you do!
A Broken Government System is to Blame
In most cases the flashing red lights are due to the government system which is the problem, and not the nursing home. We’ve got this government rulebook that requires you to go broke if you go into a nursing home, and I really feel like the government is failing our seniors. We have a situation where we have the biggest generation in the history of the country, the baby boomers, who are at retirement age. They have been saving their money and assets for the last 50 years. They’ve also been paying into the health care system for decades, to get Medicare benefits when they retire. The idea behind Medicare is that when you turn 65, and you retire, you get health care coverage.
Medicare will pay for surgery, pacemakers, hospitalizations, therapy and cancer treatment. They’ll pay for a lot of things relating to acute care, but they won’t pay for long term care expenses. Long Term Care is costly because there are numerous people required to attend to the person who needs that level of care. The cost of care is ever increasing, and the average cost for nursing homes in Pennsylvania, is around 13 to $15,000 per month. Fortunately, Medicaid will pay for that, but you have to go broke first. Nobody wants to work for 50 years, only to go broke paying for long term care. This is why we need to plan for this scenario.
Health Care Workers Are Hard to Find
The other challenge is that, after talking to people who work in nursing homes, I learned that health care workers for nursing homes are hard to find. Nurses don’t necessarily want to go into long term care. The nurses who are in long term care, tend to go from one place to another for a better salary. This means that nursing homes have to leave beds empty because they cannot meet the mandatory staffing requirements. There is a now a new legislation that has been proposed by the Medicare and Medicaid services, requiring an increase in staffing requirements for nursing homes, which creates a bigger challenge.
Red Flashing Lights
While Medicare doesn’t pay, Medicaid does pay for nursing home care. Fortunately, many of the nursing homes also accept Medicaid and a vast majority of residents who receive Medicaid benefits. The problem with this is that Medicaid is not paying the nursing homes enough. As a result, the nursing homes are not able to cover their overhead. We cannot allow our nursing homes to go out of business, because they are a necessity. Statistics point to one in three people who will need long term care, so I need to take care of my clients to help them plan for the possibility of needing long term care.
There are only three payment sources for long term care. One of them is to pay privately, which most people cannot afford at $180,000 a year. Option two is to get long term care insurance which nobody buys, and option three is getting Medicaid to pay. We need to help our clients protect their house and money that they worked 50 or 60 years to save. Nobody works all their life only to lose their money to nursing home care costs and go broke.
People Need to be Educated about their Options
Unfortunately, there are many people who don’t know about asset protection. It often happens that once they are in a nursing home, we need to assist them with nursing home crisis management. While you can still save money this way, it is advantageous to put yourself in position where you can protect your house, your money and your family by planning ahead.
We teach people about these opportunities at our Three Secrets to Estate Planning and Asset Protection Workshop. You can register for a workshop on our website. It is a free workshop that provides information on the best estate planning tools available to enable you to make decisions best suited to your needs.
People don’t always understand the importance of estate planning. If you don’t do planning, or if you have an estate plan but have not updated it, the government likely has other plans for you. I can tell you that their plan is not in your best interest or that of your family. Estate planning documents need to answer more than the question of who gets your stuff when you pass away. You need to make provision for what may happen if you get sick and need long term care. Doing proper planning will ensure that you have something to leave to your loved ones. You don’t want to lose your money to taxes and the nursing home. If you are concerned about this, come to our Workshops to learn more.
