“People who have been middle class their whole lives may find themselves on Medicaid.”
All that said, only 32 percent of people who had nursing homes stays had out-of-pocket costs. Medicaid is “an extremely important insurance program for the great majority of people in advanced old age,” Hurd said. “The very rich won’t go on Medicaid, and those that don’t go into nursing home won’t go on Medicaid. But people who have been middle class their whole lives may find themselves on Medicaid at some point. “
The costs are greater than average for women, who live longer and often go into nursing homes as widows. Men spend less time in nursing homes, at a lower cost, because their wives were there to care for them; most die married. The lifetime risk of a nursing home stay for a woman is 64 percent, compared to 51 percent for men. Out-of-pocket costs and nights spent in nursing homes are double those of men.
Not everyone will need to enter a nursing home. The half or so of the population that never has a stay “will waste or bequeath that money, and the other half will need about twice that much,” Hurd said.
But Americans are having fewer children, he noted, so while “people in their 80s were parents of boomers, and have more kids to take care of them, in the future we can expect to see increasing out-of-pocket spending and nights in nursing homes.”
This article was provided by Bloomberg News.