THE VIRGINIAN-PILOT
Copyright (c) 1994, Landmark Communications, Inc.
DATE: Wednesday, August 10, 1994 TAG: 9408100448
SECTION: FRONT PAGE: A1 EDITION: FINAL
SOURCE: BY DEBRA GORDON, STAFF WRITER
LENGTH: Long : 102 lines
Fifteen cents a week.
That's what it cost Nora Tillet, 27 years old in 1936, to buy her first life insurance policy.
Over the years, three other policies joined that first one. They, along with her house, were Tillet's nest egg, her cushion in old age and the eventual small inheritance she'd leave to her granddaughter.
But last month, Tillet, now 84, reluctantly signed papers to cash in those policies, worth about $2,400, so she can qualify for Medicaid. She needs the government program to pay for the nursing home in which she'll probably spend the rest of her life.
``I've never felt so poor in my life,'' the Virginia Beach woman said.
As the Senate continues the health care reform debate today, advocates for the aging are zeroing in on one crucial component of the various plans - coverage of long-term care.
Nursing home costs are staggering - averaging about $2,500 a month in Virginia. Private insurance rarely pays for it. Medicare, the government insurance program designed for the elderly, pays for only a limited amount of skilled care after a hospital stay.
So millions of elderly likeTillet drain their nest eggs and retirement funds to pay for nursing homes. When their savings are gone, they apply for Medicaid, the government insurance program initially designed to provide health care for the uninsured poor.
But health care reform probably won't fix the problem.
Neither of the two main health care reform proposals - those of Senator Majority Leader George J. Mitchell, D-Maine, and House Majority Leader Richard Gephardt, D-Mo., - mandate long-term care coverage.
The House bill allows states to apply for block grant programs to pay for home- and community-based care, but states would have to match 15 percent of the grant. It mirrors President Clinton's original bill.
The Senate bill goes further, recommending a similar home- and community-based grant program, but without requiring state funding; creating federal long-term-care insurance standards; treating long-term-care expenses and insurance premiums as deductible medical expenses; and establishing a voluntary public insurance program to cover the cost of extended nursing home stays.
``We're generally very pleased that the new home- and community-based-care benefit is included in each of the proposals,'' said Howard Bedlin, legislative representative for the Washington-based American Association of Retired Persons. ``We think they represent a significant start and a real solid foundation to address families' long-term-care needs.''
In Virginia, 70 percent of the state's 29,000 nursing home residents are covered under Medicaid, costing the state $349.7 million a year - 20 percent of the entire Medicaid budget.
``These are usually people who have worked hard all their lives; they're not generally welfare recipients,'' said Gloria Wertz, eligibility supervisor for Virginia Beach Social Services. ``They've been taxpayers all their life and saved this little bit they want to leave their kids, and there goes their money.''
Three years ago, Tillet had most of the $39,000 she received from the sale of her home in 1980. That money is gone now, spent on nursing home bills.
She still receives $600 a month from Social Security and her deceased husband's pension, but under the Medicaid rules, she can keep only $2,000 in assets and then $30 a month for personal expenditures. The rest will go to the nursing home.
Some elderly people hire attorneys who help them shield their assets from Medicaid review, transferring them into trusts for their children.
But for people like Tillet, who can't afford such an attorney, the only option is to ``spend down'' their assets on nursing home care until there's nothing left.
It's something Tillet just doesn't understand.
``I tried to tell her this is all certainly unfair for a lot of people, but that's just the regulations and the procedures you have to go through,'' said her friend, Willard R. Williams, who has helped her with her finances in recent months.
``We feel it's extremely unfortunate that few people realize that Medicare will not cover their long-term care needs,'' said Peter C. Clendenin, president of the Virginia Health Care Association, the Richmond-based trade organization for the state's long-term care industry.
``Accordingly, it's critical that individuals plan for their own long-term care needs.''
He recommends long-term care insurance, affordable when people are young, but more expensive as they age and begin to consider the possibility of long-term care.
Nursing home administrators are sympathetic, but realistic.
``I view it more from the standpoint of when a person needs nursing home care, if this is the way to get it, they have to do it,'' said Lee Rae Matthews, the social worker at Hillhaven Holmes Health Care in Virginia Beach, Tillet's nursing home. It is Matthews' job to help residents apply for Medicaid when they can no longer pay their nursing home bills with private assets.
``The Medicaid system doesn't leave you with a lot of money, but at least it provides you with care,'' Matthews said. ILLUSTRATION: Color photo
PAUL AIKEN/Staff
Nora Tillet, 84, had to cash in her nest egg to qualify for
Medicaid, which pays for her nursing home care.
by CNB