A new study says that Medicaid costs for long-term care may threaten the stability of the jointly run federal and state healthcare insurance program. According to the new study from the SCAN Foundation, about 70% of Americans will require some type of long-term care during their lifetimes. Most of such care comes at the end of a person’s life when a person has to transfer to a nursing home or other elder care facility.
The cost of extended care facilities can reach as high as $100,000 per year in some parts of the country, a figure that will quickly eat away at any savings a person has.
Once a person is unable to pay for long-term care expenses from their own pockets they can apply for Medicaid. As more and more people get older, and more of them have to rely on Medicaid to pay for long-term care expenses, this poses a significant problem for the program.
According to the study, people who “spend down” their assets in order to qualify for Medicaid are most often unmarried and have low levels of education. They also have lower than average incomes, meaning that they would likely be unable to pay for private long-term care insurance.
So, as 10,000 baby boomers reach retirement age every day and more and more of them will begin using extended care and rely on Medicaid to pay for it, the pressure on the program will increase dramatically. As baby boomers continue to age, this pressure will only grow over the coming years.