The Medical Bankruptcy Fear-Mongering

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You or a loved one may have just received an Alzheimer’s or dementia diagnosis, and while you may ride waves of shock and sadness, your thoughts may also turn to how you’ll take care of your loved ones (and yourself) financially.

Americans living with Alzheimer’s currently number 5.8 million. One in three seniors dies with Alzheimer’s or another form of dementia, according to the Alzheimer’s Association.

“That number is expected to increase as the population age 65 and older increases. By 2050, nearly 14 million Americans will be living with the disease unless treatments are advanced,” says Ruth Drew, director of information and support services for the Alzheimer’s Association.

Medicare provides limited assistance with costs for families of Alzheimer’s and dementia patients. Medicare benefits are for medical needs and some of the care for Alzheimer’s or dementia is non-medical in nature.

“The reality is that very few people are prepared for the cost of caring for someone living with Alzheimer’s. Many believe health insurance or Medicare will cover costs, but the costs of caring for someone living with Alzheimer’s often extends well beyond these coverages,” says Drew.

Most costs fall on your own shoulders — or those of your family members. As soon as you’re diagnosed, it’s a good idea to get a plan in place because you (or your diagnosed loved one) might not always be able to make sound decisions.

Costs you may face with the diagnosis

There are several types of costs you’ll face with an Alzheimer’s/dementia diagnosis. Remember, these are progressive diseases and your needs will change over time. Insurance may or may not cover these costs, so it’s important to know your options.

Long-term care or caregiver costs

Long-term care services can involve home-based and/or community-based services, assisted living and nursing home care. The Genworth Cost of Care Survey 2018 totaled the following costs:

  • Non-medical home health aide: $22 per hour and $132 per day
  • Adult day services: $72 per day
  • Assisted living facilities: $4,000 per month or $48,000 per year
  • Private room in a nursing home: $275 per day or $100,375 per year
  • Semi-private room in a nursing home: $245 per day or $89,297 per year

Legal fees

It’s a good idea to attack the legal angle as soon as possible, too. Consult with an elder law attorney or estate planning attorney as soon as possible to discuss a power of attorney, power of attorney for health care, a living will and/or guardianship.

Power of attorney

A power of attorney gives an agent  — the person you designate — the legal authority to act on your behalf if you do not want to or are unable to take care of certain things for yourself.

“If the person already has advanced dementia when first diagnosed, he probably would not have the capacity to create a valid power of attorney,” says Margaret “Pegi” Price, J.D., professor at National University and the author of the book, “The Special Needs Child and Divorce: A Practical Guide to Evaluating and Handling Cases.”

Price says that you should get a letter from your doctor that states that you are of sound mind, can make good decisions and can handle your finances at that time. “He should get this letter at the same time as he prepares the durable power of attorney in case someone later questions the validity of the power of attorney,” she says.

Cost: $200 to $500, depending on the complexity of the document and where the person lives.

Power of attorney for health care

A power of attorney for health care allows someone to make medical decisions for you. You must sign a medical records release so that the agent is allowed to look at your medical records when making decisions, according to Price.

“The healthcare POA needs to be durable, or it will be useless when the person needs it,” says Price. “It is always a good idea to execute several originals of this type of POA, and have one in your medical chart with your primary care doctor, one with the dementia specialist, one in the long-term care or memory care facility and one with the agent named in the POA.”

Cost: $200 to $500, depending on the complexity of the document and where you live.

Living will/standard will

“A living will does the same thing as a medical power of attorney, except that a living will usually only controls end-of-life decisions, or the last days of a person’s life,” says Price.

You might need someone to handle your health care decisions but a living will cannot do that. The health care POA can include authority to make end-of-life decisions in addition to ongoing medical care before you die.

“If the person with dementia is in an advanced stage of the disease and does not have legal capacity, he cannot create a valid living will or standard will, which distributes a person’s assets after his death,” Price says.

Cost: $200 to several times that amount, depending on the complexity of the document(s) and where you live.


Sometimes, a diagnosis doesn’t happen until well after an individual has advanced progression of Alzheimer’s or dementia. Guardianship, also called conservatorship, gives decision-making authority to someone else. It’s the only option if the person with dementia is not of sound mind.

Cost: $1,500 on the low end to several thousand dollars or more for the lawyer filing the guardianship, several hundred dollars in court costs and a couple thousand dollars or more if the court appoints a lawyer to act on behalf of the allegedly impaired person.

Prescription medication

Drugs to treat Alzheimer’s disease average about $177 to more than $400 per month according to Consumer Reports. There are three drugs approved by the Food and Drug Administration to treat mild-to-moderate Alzheimer’s currently on the market.

Personal care

Personal care services involve help with personal hygiene or other personal care. Costs vary, depending on the type of care involved.

The average rate for unskilled home-care assistance is $21 an hour. Medicare generally doesn’t help cover the unskilled care most Alzheimer’s patients need, like bathing, dressing and administering medications.

Memory care

Memory care units are specifically designed for Alzheimer’s patients. For example, a memory care facility is often set up in a circular layout because individuals with dementia sometimes feel anxiety when they encounter a dissimilar area. They offer more safety, security and relaxation than a regular care facility. It can cost $5,400 per month to reside in a memory care unit or approximately $64,800 per year, according to Dementia Care Central.

In-home care

There are a variety of types of in-home care you can pursue, whether you opt for companion care or skilled nursing care. Besides personal care services, in-home services could include:

  • Companion services: Companion services are a non-medical option that offers supervision, recreational activities and/or visits for those with Alzheimer’s or dementia. Cost: Varies, depending on the type of care needed.
  • Homemaker services: These services help with cleaning a home, shopping or meal preparation. Cost: $72 per day.
  • Skilled care: This is an option that involves a licensed medical professional. Typically, skilled care nurses injections, physical therapy and other medical needs by a licensed health professional. Cost: $132 per day.

Out-of-home care

Eventually, it may not be possible to live at home or do in-home care due to safety or family members’ inability to care for you. Specific options include the following:

  • Retirement home: In the early stages of Alzheimer’s or dementia, a retirement home could be a good fit, particularly because you’ll be able to care for yourself independently. Cost: Between $1,500 and $10,000 per month.
  • Assisted living: Assisted living is a good option as you become less able to take care of yourself independently. You’ll receive help with meals, basic needs and health care. Cost: $4,000 per month or $48,000 per year.
  • Nursing home: You’ll get 24/7 medical care. Specific nursing homes could offer care specifically for Alzheimer’s and dementia. Be sure you’re choosing the right type of facility. Cost: $275 per day or $100,375 per year for a private room; $245 per day or $89,297 per year for a semi-private room.
  • Specialized care unit: Specialized care units put people with Alzheimer’s and dementia together in a unit within a large residential facility. Cost: $233 per day, or $85,045 per year.
  • Care retirement communities: These types of communities include all of the different levels of needs (retirement, assisted living, nursing home) all together and residents are able to move back and forth. Cost: Upfront fee of $10,000 up to $500,000. You’ll also pay a monthly maintenance fee of roughly $200 to more than $2,000.

Paying for the costs

Use Genworth’s state-by-state guide to calculate the cost of in-home vs. out-of-home care in your state.

Once you know the true costs of paying for the type of care you’d like, here are a few financial resources you can consider:

Personal savings and assets

Now is the time to total up your savings and assets and see how it can fit into the plan of how you’ll pay for your care. Consider any money you might have in the following types of accounts:

  • Savings accounts
  • Checking accounts
  • Certificates of deposit (CDs)
  • Money market funds
  • Treasury bills and notes
  • Stock and bond funds

It might also be time to consider how you’d like to handle your real estate assets. Do you have a rental property or properties that you’ve used as a source of passive income? If you believe you need to move into a retirement community.

Personal loan

You can also look for a personal loan that has a low APR and interest rate as a back-up plan in case your personal assets can’t cover everything. A personal loan is an unsecured loan, which means it doesn’t require collateral to back it — in other words, you won’t have to give your lender your home or other assets if you fail to pay back your loan. Another benefit to using a personal loan is that if you have a high credit score, you could receive a low-interest loan in as little as 24 to 48 hours.

Retirement benefits

Whether you’re retired or aren’t quite there yet, you could consider taking distributions from an IRA if you have one. Two major types of IRAs are Traditional and Roth IRAs.

Distributions from Traditional IRAs prior to age 59½ are subject to a 10 percent penalty. On the other hand, you can take qualified distributions from a Roth IRA as long as you’re 59½ without penalty. However, you’ll be penalized for withdrawal of any investment earnings before 59½ unless you have a qualifying reason. Paying for medical expenses (including Alzheimer’s and dementia care) does count, as long as they’re greater than 10 percent of your adjusted gross income.

Look into withdrawing from employee-funded retirement plans, such as a 401(k), 403(b) and Keogh as well.

Insurance and government insurance programs

You might find that you qualify for government insurance programs.

Medicare or supplemental policies

Medicare is a federal health insurance program for people who are 65 or older and who receive Social Security retirement benefits. You may also be able to receive Medicare if you are younger than 65 and have received Social Security disability benefits for at least 24 months.

  • You can qualify for inpatient hospital care, doctors’ fees and prescription drug coverage through Medicare.
  • You may qualify for up to 100 days of nursing home care in some circumstances, though Medicare will not cover long-term care.
  • Hospice care can be covered for end-of-life care.

Disability insurance

You might have disability insurance from an employer-paid plan or personal policy. Long-term disability sometimes takes time to process, even up to 90 days and sometimes longer. Some policies pay benefits for the rest of your life, although this varies by policy and by the insurer. Your best bet is to contact your employer-sponsored plan or the disability insurance you’ve paid for on your own.

Group employee plan or retiree medical coverage

A separate group employee plan or retiree medical coverage collaborates with Medicare and also helps pay deductibles, co-payments and out-of-pocket medical expenses not covered by Medicare. Check to see what you’re eligible for if you belong to a group employee pan or another type of retiree medical coverage.

Life insurance and long-term care insurance

Life insurance pays out a sum of money either on the death of the insured person or after a set period. Long-term care insurance helps with the costs of long-term care, such as nursing home care. It is not provided by Medicare, which is an important factor in the decision to purchase it.

Unfortunately, life insurance and long-term care insurance are not usually available for purchase after symptoms of Alzheimer’s appear, but if you had a policy prior to being diagnosed, now is the time to call your insurance company to find out how both can help you.

Government help

In 2019, Medicare and Medicaid are expected to cover $195 billion, or 67 percent of the total health care and long-term care payments for people living with dementia.

“While these programs offer vital support to individuals living with Alzheimer’s, out-of-pocket expenditures for families are expected to reach $63 billion this year, not including an additional $234 billion for unpaid family caregiving,” says Drew.

Other potential avenues for governmental help include Social Security Disability Income (SSDI) for workers under age 65, Supplemental Security Income (SSI), VA benefits for current and former military personnel and tax deductions and credits, such as the Household and Dependent Care Credit.

Understanding and accessing these resources can be challenging. Consider consulting with an elder care attorney or contacting your local Area Agency on Aging (AAA) for help.

Veterans’ benefits

Servicemembers eligible for a VA pension and who require the aid and attendance of another person or are housebound may be eligible for additional monetary payment through Aid and Attendance and Housebound allowances. You can apply through the VA website.

Additional resources

The most common concern regarding financial resources is often how to pay for long-term care. Some legal aid societies can help. Often, the social services department at some large care facilities can give your family resources available in the area. Also consider community support, including low- or no-cost support services, respite care, support groups, transportation and meal delivery.

Many states offer financial assistance for persons with Alzheimer’s and dementia, which is paid for by the state’s general fund. Some of these programs are specifically for dementia (and require a formal diagnosis) and others are simply intended for individuals with age-related care needs, according to Drew. California, Delaware, Kentucky and West Virginia have programs for adult day care. Wisconsin, Vermont and Oregon have programs that pay for in-home dementia care.

Many of these programs are funded through the Older Americans Act. The programs receive a limited amount of funding and are only able to help a smaller percentage of individuals, and waiting lists are common. To find out about programs in your area, contact the local Area Agency on Aging (AAA).

Fighting the doomsayers…

The entire reason I started my Youtube channel last year was because I became so disgusted with the fear-mongering around retirement planning I had to say something.

The first few months it seemed I was talking to myself as I had few subscribers. Didn’t matter though because it was cathartic to me. I was able to say ALL the things I’d been denied to say while working for other firms. Liberating to say the least.

Fast forward to today though, and well over 20,000 people have found my Youtube channel interesting enough where they actually hit “Subscribe”. So, obviously, my message has not fallen on deaf ears, which is incredibly gratifying, and humbling too, as you don’t want to let these people down.

Unfortunately, when you are talking financial planning it is inherently a political topic and thus sometimes you’re going to have to take sides. I had a guy post a comment the other day saying “too much politics”. I don’t know if he was referencing the topic at hand, health care, or the fact that I brought politics into the video. But the facts are EVERYTHING we do is political. There is a reason why two liberal law professors, Silvergate and Dershowitz, wrote the book, “3 Felonies a Day”.

“The average professional in this country wakes up in the morning, goes to work, comes home, eats dinner, and then goes to sleep, unaware that he or she has likely committed several federal crimes that day. Why? The answer lies in the very nature of modern federal criminal laws, which have exploded in number but also become impossibly broad and vague. In Three Felonies a Day, Harvey A. Silverglate reveals how federal criminal laws have become dangerously disconnected from the English common law tradition and how prosecutors can pin arguable federal crimes on any one of us, for even the most seemingly innocuous behavior.”
So, while YOU may not like politics, politics definitely likes you. And you are in knee-deep in it, no matter your disdain of that dirty business.

And now that we’ve started the madness of the Presidential election season, we’ll no doubt hear calls for various government programs to “save us” from whatever calamity is under the bed, ready to attack.

The big one today is health care. Well, some on the left might say climate change so I’ll let them fight that out. But health care is where I want to focus on today.

No doubt you’ve been lead to believe that you’re only one sneeze away from filing bankruptcy due to health costs. I GUARAN-FLIPPING-TEE it that if you took a poll of 1000 random people and ask what the leading cause of bankruptcy is the VAST majority would say health expenses.

The fear of health care costs has been a favorite boogeyman not only for the left but also for the financial industry too. See my post here. Or you can see my HUGE library of posts on heath care here. Or if you’re so inclined and want to look outside of what your ole buddy Josh is saying you can listen to this Vanguard podcast on the topic.

As you can hopefully begin to see, the issue isn’t NEARLY as cut and dried as the purveyors of doom would have you believe. But it still resonates with a lot of people, voters and investors alike. The reason for this, I have to say, is because of the ignorance of the general population. Many people are simply resolved to reading a headline and maybe the first paragraph of a story and then assuming it’s true.

And that is EXACTLY how we got where we are today. Elizabeth Warren and some of her Harvard chums KNEW the media is a lap-dog for whatever high-credentialed left-wing professors from Ivy league schools were saying. And if those professors can use the words “Study finds…” all the better because from the medias perspective that means it’s “SCIENCE”. And “SCIENCE” conducted from credentialed left-wing professors from the Ivy league can’t be questioned. So the “findings’ get regurgitated without any questioning whatsoever.

Look I hate to smear our wonderful media but if you look at the bio’s of various authors nowadays you’ll see these folks are YOUNG. I’d imagine barely out of college. With little to no experience at all. I don’t blame them for their being almost awe-struck from these Ivy League professors. After all, the editors of these media outlets are just as committed to the narrative. So, it’s job security to go right along without questioning the premise.

Here was Obama’s foreign policy “expert” Ben Rhodes talking about the media:

“Most of the outlets are reporting on world events from Washington. The average reporter we talk to is 27 years old, and their only reporting experience consists of being around political campaigns. That’s a sea change. They literally know nothing.”

Thus we know the media won’t challenge the narrative of these credentialed, left-wing Ivy League professors. The academics basically have a free-pass in their desire to scare folks into turning more of their freedom over to government to protect them.

In 2005 a rather un-known law professor, teaming up with a couple Docs who were advocates for a Single Payer Health Program wrote this paper “Illness and Injury as Contributors to Bankruptcy.” The paper gained a mountain of momentum and the narrative was established. They wrote a follow up in 2007 and then wrote an “update” in 2009 after coming under HUGE criticism because the paper’s initial findings were fake.

But the damage was done. Obama ran on the theory that every 30 seconds someone in America files for bankruptcy due to medical bills and the rest is history. Turns out you really couldn’t “keep your doctor” after all.

Fast forward to today and Elizabeth Warren seems to be a top-tier candidate for the Democratic nomination. And, even after the lies of the ‘study’ were exposed, the proponents continue to promote the fraud…to this very day:

“New medical bankruptcy study: Two-thirds of filers cite illness and medical bills as contributors to financial ruin.”

Oh, yeah, they changed the narrative from medical bills as CAUSING the bankruptcy to: “medical bills as contributors to financial ruin.”

See what they did there? If we had a normal, curious media, these people would be laughed at. Yet, go back to Ben Rhodes, the average reporter is 27 years old “they literally know nothing.”

So, it’s left to others to speak “Truth to Power”. Did I actually say that? Truth to power? Ugh. But in this regard it’s the correct term because the power rests in the mainstream media’s continued dominance to establish the narrative. The narrative created by well-funded academic elites held in the highest esteem by the media. The media is left, academia is left and with little effort a narrative takes hold that has taken a no-name Professor to the cusp of the Presidency. All based on a fraud. (Well in her case TWO FRAUDS, but we’ll leave that for another day.)

Isn’t America great?

P.S.yesterday I did THREE videos on the fraud of medical bankruptcies for your viewing pleasure.

The Medical Bankruptcy Fraud

The Real Cause of Bankruptcies

4%, That’s It!

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