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COLUMN |
FOR IMMEDIATE RELEASE |
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State Rep.
Nick Kotik |
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August 2009
No one likes to think about getting older, facing chronic illness or becoming too frail to safely live on his or her own. But it happens, and when it does, seniors and families often are unprepared emotionally and financially. As you read the following news for seniors, I hope you or someone you know finds it informative and helpful.
Mainly due to poor planning, long-term care is often a cause of catastrophic out-of-pocket costs for families. Fortunately, there are steps you can take to protect your assets and ensure greater choice in long-term care options as you age.
· Long-term care insurance: For many seniors, this is one of the best ways to prepare for care. Long-term care insurance can provide coverage for a full range of services, including home care, adult day care, personal care home/assisted living and nursing homes. It can also help families safeguard hard-earned assets. Be sure to consult a financial expert.
In Pennsylvania, we recently enacted a new law that encourages the purchase of long-term care insurance by allowing residents to protect certain assets. For example, the purchase of $100,000 in a qualified long-term care insurance policy allows residents to keep $100,000 in assets and still receive Medicaid if and when their health insurance coverage runs out and they otherwise meet Medicaid eligibility requirements. Information about this new law can be found on the state Department of Insurance Web site at www.ins.state.pa.us/ins, Keyword "Long Term Care."
· Reverse mortgage: Those over 62 who own their own home can tap into their home equity with a reverse mortgage. Funds from a reverse mortgage could pay for renovations to make the home safer for an elderly loved one, provide for home health care, provide family caregivers with funds for out-of-pocket expenses, or be used to purchase long-term care insurance.
· Retirement plans: Those over 50 may want to take advantage of 401(k) or IRA "catch up" contributions. You can shelter additional contributions and build a larger nest egg. Talk with a certified financial advisor who can help you understand how to manage and protect your assets.
These are just a few choices you have. Other options may be available, depending on your age and financial situation. Be sure to consult an expert. But above all, start talking now – husband to wife, children to parents. It may not be an easy conversation, but it’s necessary. For more information about planning for your long-term care, visit the Pennsylvania Health Care Association’s Web site at www.phca.org.
In other senior-related news, the state House is considering legislation that would add an additional 30,000 seniors who currently do not qualify to the state's prescription drug program. Pennsylvania's prescription drug program, PACE/PACENET, has helped seniors living on fixed incomes pay for their medication since 1984. Unfortunately, the troubled economy has made difficult for many more people to afford essential medications.
To help more seniors, the expanded program would increase the PACENET income eligibility limit for an individual from $23,500 a year to $30,000 a year. Similarly, the income guidelines for an eligible couple would increase from $31,000 a year to $40,000 a year.
Increasing PACENET's income limits would also ensure that more seniors' prescription drug costs are covered by PACENET once their Medicare Part D benefits are capped for the remainder of the year, also known as the "doughnut hole" -- a stipulation that requires a $4,700 out-of-pocket deductible before Medicare covers the cost of medications.
The proposal to expand the state lottery-funded program in this way would also save taxpayers nearly $60 million by requiring pharmaceutical manufacturers to offer discounts to PACE/PACENET that are the same as those enjoyed by Medicaid and other states.
If you have questions or comments, please contact me. As always, you may stop by or call my Coraopolis office at 412-264-4260, or my Carnegie office at 412-429-5091, to talk to me or someone on my staff. I encourage all input on this issue.