Long Term Care (LTC) -Hope you have it.

Long Term Care Policies have been around awhile.  Many of you bought them when the payout did not have a cap on the number of years.  I purchased mine about 7 years ago through a large insurance company and was told that the cap of payment was five years.  I was informed that most people that need long term care, whether in the home or in a facility averaged about 5 years before the person expired.
I just read a study that the current average life span once LTC use begins is 3 years!  What is happening?  I did began to get curious as to what care in different facilities cost both nationwide and locally in central Virginia.  What I did find  is that the cost of  using this care in your home is growing at a much slower rate  versus a long term care facility (Blackwell, 2014).
Would not most of us prefer to be in our own home.  My insurance carrier explained to me that if I received this care in my home from an agency and/or used an elderly day care that I could stretch the monies alloted in these policies to almost double time.  For me that would be 10 years!
If I were paying out of pocket and did not have a policy, what might this service cost in my home?
As recently reported by a Genworth Financial study, "Nationally, the 2014 median hourly cost for the services of a homemaker or home health aide hired from a home care agency is $19 and $19.75, respectively. In Virginia, the median hourly cost of homemaker services is $18 and the median hourly cost of home health aide services is $19. " (Blackwell, 2014).  I am glad I purchased a policy when I did.  I would be without funds quite quickly trying to pay these rates.  I realize the agency gets a percentage of this payment but the hourly rate is about the same as a beginning Registered Nurse!
I am sure those of you that have arranged care for elderly parents are aware of these costs.  Placement in an assisted living facility or a nursing home would be close to double this assessment. The question I am left with is --why is the average life span once one begins long term care declining?  I will have to research this trend.  There will be more to come. Hope you have explored a Long Term Care Policy!

Blackwell, J. (2014).  Genworth Studies Costs of Elder Care.  Retrieved from http://www.newsadvance.com/work_it_lynchburg/news/genworth-studies-costs-of-elder-care/article_fefc9946-c47f-11e3-aea2-001a4bcf6878.html

What is Modified Adjusted Gross Income to my retirement?

In researching the affect of the Affordable Care Act  (ACA) on my IRA's, I found it had more to do with the affect on my affording health care policies if retiring early.

If I retired before becoming eligible for Medicare, I would need some type of insurance.  Those available would be COBRA (available for 18 months), private insurance, or those on the healthcare exchange.  The private insurance policy or COBRA premiums would be extremely high due to the risk pool having people in an older age group and probably with more health problems.
The best option would probably be the healthcare exchange which has subsidies available for those under a certain income level.  Now here comes the Modified Adjusted Gross (MAGI) income.  In determining the  MAGI the ACA  begins with the Adjusted Gross Income (AGI) and adds back the following credits one might be allowed on their tax form:

·         Deductions for IRA contributions.

·         Deductions for student loan interest or tuition.

·         Excluded foreign income.

·         Interest from EE(employee) savings bonds used to pay higher education expenses.

·         Employer-paid adoption expenses.

For most people, MAGI is the same as AGI. (Rinck, 2013)

The only one from above that might affect many of us is the deduction for an IRA contribution.  One suggestion is to convert to a Roth IRA even though the money is taxed.The distribution from a Roth does not count in the MAGI (Davidson, 2013).

Keep in mind that social security does count in the MAGI.  Taking the social security early such as at age 62 might be postponed.  Wow!  Everything is revolving around healthcare and where I get my money.  I feel that  my healthcare source and cost is determining all other decisions.   The MAGI is important and could cut my premiums greatly.  I am glad I now know what that is now.  The headlines I read yesterday must have been more of a political ploy but healthcare is going to control a large portion of how we fund retirement.  I guess control is the label.

Davidson, l. (2013).  retrieved from

http://www.forbes.com/sites/financialfinesse/2013/05/30/what-obamacare-means-for-early-retirees-next-year/

Rinck,A. (2013) ".Health Care Reform :  Adjusted Gross Income vs Modified Adjusted Gross Income" retrieved from

http://www.zanebenefits.com/blog/bid/256075/Health-Care-Reform-Adjusted-Gross-Income-VS-Modified-AGI

Are Our IRA's in jeopardy?

Hi Everyone!

 Have little to post today except keeping tuned to news regarding healthcare.  I did hear a couple of bleeps on the news about a possible provision in the Affordable Care Act that might put our IRA's in jeopardy.  Has anyone heard that?  I did read a lively post on another blogger's site.  I am asking permission to share.  Please if anyone has any information about a provision that could infringe on our IRA's please comment.  I am searching news articles now for that news item.


Do check out the below blog!

http://heimdalco.wordpress.com/2014/04/10/a-w-on-the-back-of-our-necks/

Ramblings About Healthcare and Medicare

I did just hear a blurb on TV that for 2014 the cuts to Medicare Advantage for 2014 have been reversed! I will explore more about this later.

Good Morning!

I had planned to explore the questions raised in last post by doing more research.  Also I planned to interview those that travel with Medicare Advantage and those with traditional Medicare with supplement.  Instead I have wrestled with the changes I have seen in health insurance in the last 50 years.  I wake up at night thinking about these. 

I have been a nurse educator since 1975.  I became interested in this profession while serving as a candy stripe volunteer in 1963.  I remember in the latter experience many individuals were in long wards and there were few semi-private and/or private rooms.  Some people did have insurance.  I did not ask but they were probably the ones in the semi-private rooms.  During influenza season, there would be patients in the hallways with a screen around them.  Back to the insurance of this time, I remember my father expressing excitement over a new job that had major medical insurance.  This is probably what we now term “catastrophic”. In college, I had single policy that covered only hospitalization.  If I went to a physician not in the student health service, I paid out of pocket.  Twenty dollars was a large office visit payment.  Somewhere I got caught up in other things and did not realize  I had a job with insurance that covered part of the office visit and any medications prescribed.  I hardly used the healthcare system at that time.  I was a young twenty something.  As thrilled as I was when I figured this out,  I remember thinking this could be a complicated development and expensive.    It has become very expensive and quite complicated.  I was in Florida recently and needed to go to a “doc in a box” for an eye infection.  There was a sign stating fees for one paying cash versus insurance filing...  The cash payment was much less.  I thought about it for a minute and then paid cash.  I later sent it into my insurance because I forgot I needed to meet my now large deductible. 

Now with the newest changes it is even more costly and complicated.  I hear the stories about social medicine in Canada and the UK.  There are countries in Europe with quite good social medicine plans.  I have a friend in Switzerland that experienced cancer and the treatment with both good results and comparable treatment to our best facilities.  Why can’t we reference and explore plans other than the UK and Canada?  If we are not going to let the free market work in this situation, we need to look at other models.  Is it so about money and politics that we can no longer problem solve?  Sorry for my rambling today.  With retirement coming it is frightening.  Many call my generation’s Medicare an entitlement.  I will remind those that a percentage was taken out of my pay checks for this coverage.  If I had been putting it into investments over the years, I may have been able to pay out of pocket for my care in ways we saw mid-twentieth century.   I am interested in what others think about my rambling?