We went this morning to see a lawyer specializing in
legal issues of the elderly. Although it
feels almost ridiculously early to be thinking about it, Marja and I have some
radical financial decisions to make. The
most important is thinking about long-term nursing-home care. Most (an estimated 75% according to one
source) Alzheimer’s patients end up in nursing homes at tremendous cost. And that brings up the question of protecting
our IRAs and the inheritance we have from Marja’s mom. Nursing homes for people with Alzheimer’s can
cost $80,000 a year. Medicare does not
cover the care, and—as I understand it—Medicaid will pay for nursing home care
only after the person (or family) has spent down most of their savings.
And to prevent the wealthy from making legal
arrangements give the money away but keep control over it, Medicaid has a five-year
“look-back” and would not cover nursing home care if we’d given our money away
during that period. I’m not yet clear
how it all works, but I’ve been told that it’s perfectly legal divest ourselves
of money prior to the 5-year look back. Given
my stage in the disease, there’s a good chance I won’t need the nursing home
care for five years. If that’s the case,
then it makes sense to give most of our money away now.
There is the important question of the ethics of such
manipulation to stick the government with the cost when we could pay at least
much of it ourselves? But I feel no
ethical qualms. First of all, Marja and
I have spent our adult lives volunteering or working at wages much lower than
possible in order to serve the poor.
Since the US, alone among Western industrialized countries, does not
protect its residents from destitution, we (and many others, of course) have
been doing the job our government should have been doing.
Furthermore, when Marja and I received her
inheritance, we made the decision to give away the vast majority of it to continue
to work for justice in our country, which we have been doing. It would be possible to spend the money immediately
by giving it all to charitable organizations, and we are doing some of that. But we have also felt it important to give directly
to support individual poor people. Someone
has said that what the poor need is not more programs but more money. That’s an oversimplification but we’ve
decided to give certain poor people we know, (and we’ve known quite a few after
my years as a doctor and Marja’s years as a teacher.)
The problem is that, if we want to be responsible
about giving the money away directly to poor people, it takes a while. We want to make sure the money is used well,
so we only support people we know personally.[1] And if we don’t want to encourage an
unhealthy dependency in those to whom we give, it’s a slow process. Giving our money directly to poor people (and
organizations supporting peace and justice) corrects a small part of the
injustice of our country. The real
responsibility for correcting that injustice lies within our society through
government, but society has chosen not to do that. So we feel no qualms about having government
pay for whatever nursing home expenses we need as long as we can do it legally
and with transparency.
So we have to think about how best to sequester our
money and that’s where the lawyer comes in.
There are lots of other similar decisions that we should be making
pretty quickly. The financial consequences of such decisions will be enormous.
[1]
Just to be clear, we are not a foundation or charity and do not accept or pay
attention to requests from strangers.
I just found your blog. Thank you for writing it.
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