Medicaid could wipe you out
Was listening to the BP podcast 71 when they started talking about the insurance stuff at the end of the show.
Boy howdy, I need to write more content here for you all.
I have a lot of things going on right now. I am a bad country song with a cat on hospice. But we really need to have a chat about healthcare.
Little civics lesson here. You are not just a citizen of the USA, but also the state where you live.
Insurance is a state level product, so there are 50 different charters for what insurance looks because it is managed by 50 different state governments.
If you in a state with a larger GDP like California, you have more generous benefits available because they have more money and they use a portion of it to fund social infrastructure programs like Medicaid. If you live in a really poor state or common wealth the story is different. For example, America Samoa is a US territory. It is a small island, but over half the population makes less than the poverty level. So when Medicaid was created it had two options and the one everyone else did is the one we are familiar with – creating a Medicaid program.
America Samoa opted for the other option, they created one hospital and all the Medicaid funds go to that one hospital instead of the individual.
Each state and territory has someone over seeing how insurance is regulated. There is federal stuff, but the states each control this very tightly within the state border.
I can speak for Washington. We have a generous program compared to a lot of states when it comes to Medicaid. But there are fine points to the programs. And this is where you could loose money. Maybe all of it.
You and your spouse get FIRE level Fat at 30, 25 years ago. And it has been a wild adventure. Now you have a modest home that is paid for and kicking it here in Washington state. You got it to where you have just $600,000 sitting in the bank and the income you are drawing is about $1700 a month. Waiting for social security. Your income qualifies for expanded Medicaid.
One of you ends up really sick and in a nursing home for a year recovering. You are both over the age of 55 and you make the mistake of thinking the Medicaid will cover it. For long term care, there is an asset re-allocation clause in the expanded Medicaid. The free program just turned into classic Medicaid and now you have a spend down and a bunch of complicated stuff that will turn into a financial nightmare.
There is a lot to the insurance stuff. And when you talk to people who are experienced, they (like I did) are going to encourage you to do things that seem correct for a majority of people out there. But the reality is, until I had a couple walk into my office and explain they wanted health care through the exchange, even though they had a very low income and qualified for Medicaid, this couple took out the application that I thought I had read and pointed it this clause. Asset re-allocation.
This is really complicated stuff. There are 50 different states and a bunch of territories and throw in the VA and native American programs…
I know this stuff is needed here for the FI community. And it keeps coming up over and over. Part of the solution is Medicare for all. I am not a proponent of this, but I really don’t see any other solution. And even then, its going to cost you. I have a white board on my wall here in front of my computer. I am writing in big letters – Explain Medicare and Medicare for all in a blog post this weekend. Sunday the 12th, by 9pm Pacific time (cause I go to bed early) I will have posted possibly a couple blog posts on Medicare and what Medicare for all would look like in my opinion based on what I know about Medicare now.
I don't have the time or bandwidth in my brain to figure out how to post this picture and turn it 90. But this is it! Medicare and Medicare for all explained!
And I will try to write more content on this subject every 2 weeks until I finally settle into a new living situation. And get my car back.
And I would like to leave on another note - the Medi-Share program may have been used mostly by the Christian Community, but it is not exclusive to them to have this. Why can't the FI community have a cooperative program like the Medi-share. It would take way more brain power then I have to think how that would work.
Bigger pockets healthcare. Could Happen.