Obamacare requires everyone in the U.S. whose income is less than 138% of the poverty level to enroll in medicaid. Given what happened in California, Obamacare could result in tens of billions of dollars worth of private assets being seized by the government.
And you can bet Grandpa Warrenn will be right there to snatch up the property. Crony capitalism is a wonderful thing!
Unless you have assets to pay for your own health care, the asset recovery rule doesn’t apply. If you have next to nothing, there is nothing for the government to confiscate. And we don’t leave people to fend for themselves in this country. If you’re enrolled in Medicaid, you don’t need to worry about it - and the government seldom bothers because the costs of recovering negligible assets are exceeded by the lifetime medical costs of the Medicaid beneficiary. It shouldn’t deter people from enrolling in the program.
So they use historical figures of recoupment from when you had to be destitute to get Medicaid/Medi-Cal to show that the government hardly takes anything. Except they’ve now changed the rules so you can have unlimited assets if you meet the income requirements. And limited your options.
I thought being on Medicaid basically meant you had no money....no assets....
ping
The word used is seizure. In practice, don’t people exchange real estate assets for living quarters in long term care facilities to facilitate the change ?
There is a very real problem of huge expense involved with extended care or long term care that is paid with the sale of residential assets. Even with the sale or title lien, there is the problem of outliving the value.
I have been closely associated with the problems of old (really old) ladies and extended care for themselves and in some cases husbands.Although there are numerous possible cash streams to pay for the care, the house is often the primary asset to be drawn down .
My neighbors of 45 years recently moved into an extended care facility. She is spry but her husband is in bad shape. The extended care facility or perhaps a bank, took title to the house and it was auctioned. On reflection, this procedure may have been the new Obamacare rules at work. The auction sale might not have produced the maximum return but it quickly resolved the issue.
The bottom line is that there is no really good universal solution for those of us who are getting old and face the transition from living as we have for decades to smaller quarters that come with some variety of medical care.
Bookmark.
Here is a good comment from the LA Times site:
Ukenuke at 3:08 AM February 13, 2014
If you own a house and have a bank account but low income, you’d be an IDIOT to accept Medicaid and put 100% of your assets at risk.
There’s nothing overblown about this. In California, the law REQUIRES Estate Recovery, and the exclusions for spouses and children under 21 are TEMPORARY, expiring when the spouse dies and the child turns 21.
The promise that hardship waivers are treat “liberally” is a joke. You’d be a MORON to trust the state PR flak with your life savings.
This is a wealth-destroyer for middle-class families who wanted to leave something to their grandkids. And again, if you’re over 55 and you work only part time, you may have NO CHOICE but to accept Medicaid, putting 100% of your assets at risk, even if you want to pay for insurance.
There’s no weaseling out of this issue until a law is passed repealing estate recovery. If you’re middle-class, and have some assets but low income, find a way to inflate your income to avoid Medicaid. (Maybe have a friend “pay you” something, then “pay him” back, and take the hit on your income taxes, which should be minimal at Medicaid threshold.) NOBODY WAS EVER PROSECUTED FOR OVERSTATING THEIR INCOME ON A TAX RETURN.