1/31/96 BOZEMAN --Nearly half of all Montanans will spend time in a nursing home at some point in their lives, and nursing home costs are skyrocketing--now averaging $30,000 per year.
These high costs lead to a lot of anxiety about how people will afford such care, says Marsha Goetting, a family economics specialist with the Montana State University Extension Service.
Goetting is a co-author of Medicaid and Long-Term Care Costs, an Extension Montguide fact sheet which explains the options people have for paying for long-term care.
Goetting cites four main options. Some people use their own income and assets to pay the costs, while others depend on the financial resources of adult children or other relatives. People also purchase long-term care insurance to defray the costs of nursing home care.
A fourth major option is Medicaid. Originally designed to provide medical care for needy women and children, the program is now being viewed as an entitlement by many middle-class Americans, she says.
In order to qualify for Medicaid, some people deliberately become impoverished by giving away all their property or transferring assets to an irrevocable trust where a trustee manages them. Although this can be legal, impoverishment can be psychologically and socially traumatic. Taxes can be assessed on the transferred property. And should a person's health improve to the extent that nursing home care is no longer required, he or she would no longer have a home or nest egg.
The legal, financial and psychological ramifications of paying for long-term care are vast, and the laws are constantly changing. Before you make a decision, consider all your options and consult a legal or financial adviser, advises Goetting.
For a free copy of Medicaid and Long-Term Care Costs, contact your county's MSU Extension Office, or send $1 for handling to Extension Publications, 115 Culbertson Hall, Montana State University, Bozeman, MT 59717. Ask for publication MT 9511 HR.
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