Why save for retirement if medicaid will cover your costs!?!?

[Anonymous]

Anonymous wrote:Np here. My mother and step father are relying on medicare and can't get access to in-home care. He needs a nurse (and so does she really) but are forced to go without. Medicare does not cover nursing home. This means they are in the ER (via ambulance) about once a week.

That being said, they don't qualify for medicaid but can't afford assisted living in their area. So sufficient savings is really needed if you want any quality of life.

Curious, why don't they qualify for medicaid?

[Anonymous]

I posted about a $2000-$3000 a month place. This is where my father stayed in NJ. It is very limited care. He is paying for a room and 3 meals in the cafe. You do your own laundry etc. It is a small room with a kitchen and a bed, small living room type area. People with more needs, bathing, hourly checks etc. pay up to $5,000-$7,000.

[Anonymous]

Anonymous wrote:I have a question. Aren't we talking about Medicare, not Medicaid, or am I missing something.

Both. You need to get a special nursing home Medicaid for nursing home. They do not pay for assisted living.

[Anonymous]

Anonymous wrote:

Anonymous wrote:Np here. My mother and step father are relying on medicare and can't get access to in-home care. He needs a nurse (and so does she really) but are forced to go without. Medicare does not cover nursing home. This means they are in the ER (via ambulance) about once a week.

That being said, they don't qualify for medicaid but can't afford assisted living in their area. So sufficient savings is really needed if you want any quality of life.

Curious, why don't they qualify for medicaid?

Very limited income and assets. Cannot have over $2500.

[Anonymous]

PP, Medicare does not cover nursing homes. When you hear about someone who is in a nursing home and has run out of money and is having it paid for, it is Medicaid, not Medicare that is paying for it and only for those who are out of money.

OP, living on just SS in retirement is living very poor and many people do not end up needing nursing home care for long at the end of life so it would be silly to just keep yourself extra poor in old age for that reason. Also, as others have said, it is hugely helpful to be able to pay for at least a little nursing home care and then switch to Medicaid if money runs out.

[Anonymous]

Anonymous wrote:

Anonymous wrote:As PPs noted, life on Medicaid is anything but sweet.

Curious, OP, if your cultural tradition includes caring for aging parents in exchange for inheritance, why is Medicaid an issue at all?

The above scenario works in the homeland, where typically the daughter or daughter in-law does not work outside of the home. It won't work for us here becauseboth my brother and I work and therefore can't provide the care. My parents never thought, does anyone?, that they would end up in a position to worry about this. So as they built up an inheritance for us, due to misinformation, they missed or misunderstood how medicaid works. They have a decent savings - a fully paid house, car and about 100-150K savings. I just wished they enjoyed life more and didn't feel the need to save this money for me and my brother - esp since we are both working and contributing to our own retirement plans.

I didn't realize that the care a medicaid recipient receives is different. My husbands undle was in a nursing home for rehab, ended up dying there, and he was self pay. I thought it was a horrible place, as a PP described, sad, old people left in wheelchairs in hallways, dilapidated rec area with various games that didn't work. His estate went to his care and ti was awful.

1. Your parents do not need to save their money for you. They need to take care of themselves with their money and not concern themselves with whether they will have anything to leave to you.

2. "His estate went to his care" is inaccurate - his MONEY went to his care. An estate is what is left after a person dies - prior to that, no one is entitled to it other than the person to whom it belongs.

[Anonymous]

Anonymous wrote:Anyway, Speaking with my SIL parents, who are both recently retired, I found it fascinating and surprising that they have saved NOTHING for retirement. Why? because they both worked and are currently receiving social security and disability payments, moved to delaware and can survive just fine on what they are receiving. If the need ever arises where they need nursing home care, medicaid will pick up the tab.

I think this sounds a lot rosier than it really is. It is stressful to live close to the edge. (Also, unclear how much they are really getting--you can't generally receive social security and SSDI at the same time, and most long term disability programs stop covering you at 65.) The average SS check is about $1200 and spousal benefits are about $600 more. Social security payments do not always go up as fast as prices, so while they may seem OK now, over time they may become more poor. Plus, even if they are healthy now, most people end up needing more medical care as they get older--the average out-of-pocket costs for people on Medicare is several thousand dollars a year. I would rather have saved some of my own money so I have choices as long as I can, even if eventually I need assistance to pay for long term care.

[Anonymous]

I think the quality of nursing homes and assisted living places is going to become a huge issue as baby boomers retire. Glad to see the 'village' concept of retiring at home is taking hold, but when you need full-time nursing care at home it gets ghastly expensive. Maybe there will be nursing care cooperatives? Never heard of that but maybe it could work.

[Anonymous]

Anonymous wrote:

Anonymous wrote:Np here. My mother and step father are relying on medicare and can't get access to in-home care. He needs a nurse (and so does she really) but are forced to go without. Medicare does not cover nursing home. This means they are in the ER (via ambulance) about once a week.

That being said, they don't qualify for medicaid but can't afford assisted living in their area. So sufficient savings is really needed if you want any quality of life.

Curious, why don't they qualify for medicaid?

Also, while Medicare does not cover nursing home care, it DOES cover home health care for home-bound beneficiaries.

[Anonymous]

I also wonder about people that save a ton of money for retirement. For example, my dad made an offhand remark one day that they have a few million saved and will probably never use all that money. Hell I wish they'd spend more of it and make up for lost time, they deserve it.

I agree it's important to save some amount of money (for argument's sake let's say an amount that would let you draw $35-40K per year in addition to your SS payments). That lets you take a few modest trips and live a comfortable life but not extravagant (this plan also assumes you'll have paid off your mortgage or will sell and move to a lower COL area so housing expense is minimal).

Obviously there's a margin of error here too and you want to err a little on the side of caution but I can't see socking away tons of money for retirement. By the time you're old and need nursing home care your quality of life kinda sucks already so why not use more of the money when you can actually enjoy it.

[Anonymous]

I'm glad to see that lots of pps have addressed the fact that Medicaid gets you poor nursing home care compared to being able to pay your own way. I want to address the concern OP has about whether it's worth it to save. I see this theme with regard to college grants and aid. Understandably folks ask why they should save when they see people of comparable backgrounds not saving and planning to get aid based on need.

As people have noted, why would you want to have to rely on the hope that need-based aid will operate in the future the way (you think) it does now? There may be a few people somewhere who get some kind of benefit from not saving and then receiving some kind of need-based aid, but why not just feel good that you have that area taken care of and ignore them? I'd rather go into retirement knowing I have everything covered and feel secure. It's not a race where somehow the wasters of the world are getting ahead of me.

On another note, thanks for bringing this up, OP. I've been helping to support a relative who's on disability now and unless he keels over from a heart attack, there's a nasty Medicaid-funded nursing home stay in his future. Argh. And in the meantime that extra money I should be stashing away in my 401k is going to supplement his disability check. I think we're okay for our retirement but I wish I could be adding that extra money to it instead of writing a check every month!

[Anonymous]

Anonymous wrote:I'm glad to see that lots of pps have addressed the fact that Medicaid gets you poor nursing home care compared to being able to pay your own way. I want to address the concern OP has about whether it's worth it to save. I see this theme with regard to college grants and aid. Understandably folks ask why they should save when they see people of comparable backgrounds not saving and planning to get aid based on need.

As people have noted, why would you want to have to rely on the hope that need-based aid will operate in the future the way (you think) it does now? There may be a few people somewhere who get some kind of benefit from not saving and then receiving some kind of need-based aid, but why not just feel good that you have that area taken care of and ignore them? I'd rather go into retirement knowing I have everything covered and feel secure. It's not a race where somehow the wasters of the world are getting ahead of me.

On another note, thanks for bringing this up, OP. I've been helping to support a relative who's on disability now and unless he keels over from a heart attack, there's a nasty Medicaid-funded nursing home stay in his future. Argh. And in the meantime that extra money I should be stashing away in my 401k is going to supplement his disability check. I think we're okay for our retirement but I wish I could be adding that extra money to it instead of writing a check every month!

Look into some of the income based housing programs if he can live on his own.

You can get financial assistance, the problem is getting a bed, in less you go directly from a hospital setting. I've been trying for 3 months to work with one nursing home to get their paperwork done and when I got it done they informed me it would be a 6-12 month wait. Others have outright refused. Its a huge problem as there are not enough services for those in need.

My plan: death. Even a few million will not get you very far so if you are in a middle income, you are pretty much in trouble, even if you do your best to save.

[Anonymous]

Anonymous wrote:I think the quality of nursing homes and assisted living places is going to become a huge issue as baby boomers retire. Glad to see the 'village' concept of retiring at home is taking hold, but when you need full-time nursing care at home it gets ghastly expensive. Maybe there will be nursing care cooperatives? Never heard of that but maybe it could work.

Those village concepts are a fortune. Many require buy-ins at anywhere from $100-400,000 and monthly fees. There are lots of great options if you have a lot of money to spend. There are very few for lower-middle income families.

[Anonymous]

Anonymous wrote:I also wonder about people that save a ton of money for retirement. For example, my dad made an offhand remark one day that they have a few million saved and will probably never use all that money. Hell I wish they'd spend more of it and make up for lost time, they deserve it.

I agree it's important to save some amount of money (for argument's sake let's say an amount that would let you draw $35-40K per year in addition to your SS payments). That lets you take a few modest trips and live a comfortable life but not extravagant (this plan also assumes you'll have paid off your mortgage or will sell and move to a lower COL area so housing expense is minimal).

Obviously there's a margin of error here too and you want to err a little on the side of caution but I can't see socking away tons of money for retirement. By the time you're old and need nursing home care your quality of life kinda sucks already so why not use more of the money when you can actually enjoy it.

No one has a crystal ball. My mother was competent and independent and fine living alone - until she wasn't. Dementia hit when she was 76, then hit hard the next year such that she had to move into assisted living ($3400ish/month). Every six months or so her needs increased ($$$) and by the end, seven years after going into assisted living, she could not do anything on her own - she needed help eating, toileting, getting dressed, bathing - everything. At that point the cost was $8K a month plus another $2K for the daily helpers from outside that she needed.

Thank goodness she had fantastic wraparound insurance.

She had saved a LOT for retirement and paid everything herself until the day she died - and she left her kids something too.

I never want to burden my kids with expenses of that nature/level, so we save aggressively.

[Anonymous]

Anonymous wrote:

Anonymous wrote:I also wonder about people that save a ton of money for retirement. For example, my dad made an offhand remark one day that they have a few million saved and will probably never use all that money. Hell I wish they'd spend more of it and make up for lost time, they deserve it.

I agree it's important to save some amount of money (for argument's sake let's say an amount that would let you draw $35-40K per year in addition to your SS payments). That lets you take a few modest trips and live a comfortable life but not extravagant (this plan also assumes you'll have paid off your mortgage or will sell and move to a lower COL area so housing expense is minimal).

Obviously there's a margin of error here too and you want to err a little on the side of caution but I can't see socking away tons of money for retirement. By the time you're old and need nursing home care your quality of life kinda sucks already so why not use more of the money when you can actually enjoy it.

No one has a crystal ball. My mother was competent and independent and fine living alone - until she wasn't. Dementia hit when she was 76, then hit hard the next year such that she had to move into assisted living ($3400ish/month). Every six months or so her needs increased ($$$) and by the end, seven years after going into assisted living, she could not do anything on her own - she needed help eating, toileting, getting dressed, bathing - everything. At that point the cost was $8K a month plus another $2K for the daily helpers from outside that she needed.

Thank goodness she had fantastic wraparound insurance.

She had saved a LOT for retirement and paid everything herself until the day she died - and she left her kids something too.

I never want to burden my kids with expenses of that nature/level, so we save aggressively.

^^^PP here.

P.S. I made certain to choose an assisted living for my mom that had a Medicaid-accepting, fantastic skilled nursing (nursing home) as part of the same facility. My thought was that if she needed to go into nursing care, she could stay where she was as a paying resident for as long as possible, then become a Medicaid-pay bed. She would have had first priority as a paying client. She died before this became necessary, but FYI for those of you facing these issues - planning and strategy are everything.