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Medicaid and Long Term Care

Reports have surfaced showing that many states have underestimated and under-funded the cost of long term care.  Medicare has done so as well.  This has left many seniors understandably worried.

The estimates for the costs of long term care seem to be nearly $4.5 billion dollars below actual costs of providing quality care.   The main states affected are California, Florida, Wisconsin, Massachusetts, New York, Illinois, Ohio, Pennsylvania, New Jersey and Texas.

Because of the fact that the gap between what quality care costs and what Medicaid actually pays is substantial, states are looking for a solution to eliminate at least part of the shortfall.  Extreme budget pressures have states in a quandary as to what to do.  They are looking for extra dollars, because if they cannot make up at least part of the difference between cost of care and payment for care, some seniors may not be able to get long term care services.

The American Healthcare Association (AHCA) President and CEO, Bruce Yarwood, feels that “a

post-election stimulus package must include state Medicaid relief to help prevent problems with accessing this essential care in 2009.”    The long term care industry hopes this will happen.  One bright sign is that the head of the Federal Reserve recently indicated that in order to bolster the country’s economy, federal dollars need to be injected into state budgets to help provide essential services.

According to the National Governors’ Association, combined state shortfalls total $50 billion for the fiscal year from July 2008 to July 2009.  Without federal help this will be an insurmountable amount.  In addition, Medicaid is being “propped up” by Medicare, according to Yarwood, who feels that this leaves Medicaid in a very vulnerable and precarious position.

For now, all that seniors can do is to protect themselves the best they can with the coverage they can get and wait to see what lawmakers will do when working out the federal budget.  Hopefully they will see the value in helping states stabilize programs such as Medicaid to ensure long term care for the nation’s senior population.

Category: Insurance

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