Efforts to repeal and replace Obamacare have been
suspended for the time being, and many Americans are breathing a
sigh of relief.
But Obamacare is far from safe, and the same is true for one of
the key programs – Medicaid – that the law used to expand health
care coverage for millions of Americans.
While many people may think of Medicaid as a government program
that helps only the nation’s poor, that is not
Medicaid helps pay for – and
is indeed part of estate planning strategies for – nursing home
care and other forms of long-term care. Since all Americans live
in communities with elderly people, will grow old themselves or
have aging parents, long-term care and how to pay for it is a
matter that affects us all, even if we do not realize it.
I am a professor of law and bioethics who sits on a hospital
ethics committee in Cleveland and has researched aging and
long-term care extensively for my scholarship. I have learned a great deal about
the cost of care and the importance of Medicaid, which not enough
Drew Angerer/Getty Images
A rising expense, a growing population
Long-term care in the United States is extraordinarily expensive.
The median annual cost of a private room in a nursing home is
over $92,000, and a shared room costs
over $82,000. These prices will only increase in
the coming years, as costs have risen by
almost 19% since 2011.
The median price for care in an assisted living facility, which
provides residents with meals and other forms of assistance but
not with skilled nursing care, is over $43,500. Those who want to remain at home with
the help of an in-home aide from a home care agency will pay
approximately $20 an hour, which
translates into $175,000 per year for round-the-clock care.
According to the US Department of Health and Human Services,
“70% of people turning age 65 can expect to
use some form of long-term care during their lives.” It is
important to understand that despite its high cost, long-term
care is generally not paid for by Medicare,
the government program that covers seniors, or by private health
So are most Americans financially equipped to pay on their own
for nursing homes and other types of assistance when they are
elderly? The answer is a resounding “no.”
A 2015 US Government Accountability Office report found that
“about half of households age
55 and older have no retirement savings
(such as in a 401(k) plan or an IRA).”
The National Institute on Retirement Security concluded that
American households had a median retirement savings account
balance of just $2,500, and the median for those nearing
retirement was a mere $14,500. Such meager savings make it extremely
difficult for retirees to cover their out-of-pocket medical costs
for co-pays, deductibles, and noncovered items such as hearing
aids, which often reach several thousands of dollars per year. A
prolonged period of long-term care on top of these costs is
certainly not in most people’s budgets.
Medicaid and seniors
Enter Medicaid. While many may think Medicaid primarily covers
poor people, about 28% of its overall
budget is spent on long-term care.
That money is vital to seniors and to the nursing homes they live
in. In 2014, Medicaid paid for 62% of nursing home
residents. Increasingly, it covers assisted
living and in-home care, which many elderly people
Medicaid is still a program that serves only financially
disadvantaged individuals and has
strict eligibility requirements, but people who need
long-term care, including some who
were middle-class, end up “spending down” their money by paying for
nursing homes or other assistance out of pocket and then qualify
for Medicaid. This includes many who worked hard and supported
themselves and their families their entire lives but simply did
not have enough retirement savings to cover the exorbitant costs
of medical care and long-term care. Those who spend down
are very rarely wealthy, with about
85% barely hanging on economically before “spending down.”
Republican proposals to repeal and replace Obamacare targeted
Medicaid for significant cuts that would have affected seniors
receiving long-term care. Many in Congress
still hold out hope of eliminating
Obamacare, and this should make all of us worried.
Medicaid and all of us
What might happen if frail and elderly people cannot receive
needed care? Some will have to turn to loved ones for extra
Family and friends already bear much of the burden of caring for
the elderly. According to the Alzheimer’s Association, over 15 million
Americans tended to dementia patients in 2016, supplying an
estimated 18.1 billion hours of unpaid care.
Overall, older adults receive $470 billion worth of unpaid
care each year. Without Medicaid, the
elderly will often need to ask more of their relatives or even to
move in with them.
Caring full-time for someone who is physically disabled or has
dementia can be emotionally exhausting and can lead to anxiety,
depression and other mental and physical health problems;
create conflicts within families; and be financially draining,
especially if it affects caregivers’ ability to work outside the
Other elderly people will try to continue living independently
without the help they need. This can create dangers for other
members of their communities. They may have to drive in order to
get groceries and supplies, and this can lead to more car
Indeed, The American Medical Association and National Highway
Traffic Safety Association state that “on the basis of estimated annual travel, the
fatality rate for drivers 85 and older is nine times higher than
the rate for drivers 25 to 69.”
They will cook alone and perhaps forget to turn off the oven or
burners, which can cause fires. And they will be at high risk of
falling and needing care in emergency rooms.
As more patients flood emergency rooms, the wait times for
everyone will increase, and already understaffed hospitals may
provide less attentive care.
These problems will only grow in the future. In
2015, 14.9% of the population, or 47.8 million
people, were 65 and over. The number of seniors is projected
to expand to almost 73 million by 2030 and to represent
over 20% of total US residents.
Society will not be able to ignore their needs.
We will all be affected if elderly members of our communities
cannot get needed care. Moreover, many of us will find that
long-term care is unaffordable for our own loved ones or for
ourselves. None of us knows whether we will develop dementia or
another serious chronic condition that requires intensive care
for many years.
Medicaid is not just about the poor. It is about all of us, and
we should all care deeply about maintaining and strengthening it
for the future.