As people get closer to retirement, they start to think about how costs will seemingly pile up.  Most will hope that they have enough money to take care of their medical bills.  Medicaid and Medicare is what they hope will bridge any deficiencies in their pocketbooks.  But Medicaid is an imperfect system and has seen decreases in funding both from the federal and local governments.

It also isn’t available to everyone.  According to a survey of financial advisors, people are even considering gifting their assets to loved ones in order to qualify for Medicaid.  In a recent study conducted by Nationwide Financial, 42% of financial advisors have seen this trend occurring so that people don’t have to pay for their own nursing homes.  “Medicaid was created to help low-income Americans and not to supplement middle-class and affluent families,” says John Carter, president of distribution and sales for National Financial.  At this time it is not against the law to “gift” money to family members, although there is a limit to do so without being taxed.

The downside of “gifting” is that people can use that money for long term planning rather than essentially throwing it away and hoping to be subsidized by the government.  Medicaid limits the choices of nursing homes which can be a shock to people as they consider their need for constant care.  It can also limit the selection of doctors as only about a third of doctors accept Medicaid patients.

The best option for those who aren’t rich enough to pay out of pocket for nursing homes, doctors, and increased costs of health care at advanced ages need to consider long term care insurance.  Contact an experienced insurance specialist at Wise Insurance agency in Marin County who can assist you in creating a viable plan to take care of you when Medicaid and Medicare can’t.