THE ELDERLAW FORUM

Professor Michael Myers

Rural Illinois House For Sale: $14,000 

            Money–or more precisely, the lack of money–drives public policy, often without logic.  The Medicare program and its failure to address long-term care is a classic illustration.

             Medicare–Title 20 of the Social Security Act–was enacted to mitigate the financial risk associated with an event over which we have little control: contracting a life-threatening disease when older and financially vulnerable.

             It was, Congress reasoned, fundamentally unfair for poor health to drive into poverty a couple that had spent 50 years rearing a family, paying college tuition and taxes, mowing their grass, and otherwise being responsible members of society.  It observed that for everyone poverty lurks just around the corner in the form of cancer, congestive heart failure, multiple sclerosis, or Alzheimer’s,

             In 1965 the private health insurance industry had little interest in enrolling 65-to-90-year-olds who could not afford to pay actuarially-sound premiums.  Even a recalcitrant American Medical Association recognized the social value of government-financed health insurance for the elderly.

             The American Hospital Association recognized the enormous financial windfall of having billions of dollars in federal tax money available to pay its members for hospital services.  Hence, Congress created Medicare Part A to pay hospitals and Medicare Part B to pay physicians.

             Today Medicare, without blinking, will pay $100,000, $500,000, or even $1 million over a period of days or weeks in an attempt to snatch a cancer or heart patient from the jaws of death.  It is generous in paying for “medically necessary” MRIs, chemotherapy, bypass surgery, hip replacements, and laboratory tests.

             But $40,000 for a year in a long-term care facility?  No, too expensive, concluded federal policymakers.  For that type of assistance, our grass-mowing, tax-paying couple must first “spend down” into a condition of abject poverty.  And when they are both dead, the state will take their home.

             A USD Senior Legal Helpline caller (1-800-747-1895; mmyers@usd.edu) said her 84-year-old mother had just moved to South Dakota from Illinois and had been advised she had to sell her mother’s extremely modest $14,000 home to qualify for Medicaid assistance.  “I hate to tell her we have to sell her house.  It’s all she has,” said the caller.

             Non-exempt assets cannot exceed $2,000 for Medicaid eligibility.  “House for Sale” in Rural Illinois, Shack Decor, With Great Memories, $14,000 (minus fees, commissions).”