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Deficit Reduction Act


     I practice elder law and spend my working hours counseling seniors and their families on various legal issues unique to their situations. Over the next several months, I will be sharing with you some of what I've learned in the course of my practice and responding generally to questions or concerns you may have.

     To get us started on this journey, I want to share with you my concerns about recent federal legislation that promises to have a direct impact on the seniors in our community. The Deficit Reduction Act of 2005 (the "DRA") was signed into law by President Bush on February 8, 2006. It has been lauded by the current administration as the first reduction in government entitlement or "spending" programs in nearly 40 years. Among other entitlement programs, DRA took direct aim at Medicaid spending for the elderly in long term care. The political spin that carried DRA into effect was that millionaires were qualifying for Medicaid to pay for their nursing home care. The practical effect of the law has been to insure that only the rich will qualify for Medicaid for long-term care without losing the family farm.

     Nursing home care in our community easily costs $6,000/month for a semi-private room. Most seniors do not have private health insurance and rely on Medicare for their health care needs. Medicare, even when complemented by a Medicare supplement policy, offers little or no coverage for nursing home care. Very few seniors have any long-term care insurance. Most could not have afforded long-term care insurance at the time that they would have qualified for coverage. So the senior is who is dealing with the fear of an Alzheimer's diagnosis and the family that is struggling to care for mom who has recently suffered a severe and debilitating stroke must also struggle with the financially devastating prospects of nursing home care.

     The impact of DRA is that it will be much more difficult for the majority of patients to obtain the care they need. If in the five years prior to needing skilled care, a senior has made a monthly tithe to his church or tuition payments for his grandchild or helped his child with a down payment on a home, he will be ineligible for Medicaid benefits to pay for his care for at least some period of time after he runs out of money to pay for his own care.

     Representative Charles Taylor and Senators Elizabeth Dole and Richard Burr each voted in favor of the DRA. They cannot claim not to know the impact of the DRA on our senior population because AARP and the Alzheimer's Association and the National Academy of Elder Law Attorneys all made certain that each senator and representative was aware of the harmful results that DRA would create.

     DRA completely disregards the fact that the overwhelming majority of nursing home patients are children of the depression and are World War II veterans or their surviving spouses. Congress has failed to acknowledge that our country was largely built on the strength of character and work ethic of this generation. Instead of protecting some of our most vulnerable citizens or taking measures to solve what looms as a health care crisis, Congress has mandated that the middle class senior citizen requiring nursing home care will have to choose between benefiting his family or fulfilling his obligation to his church and obtaining the care he may need as he ages. At the same time, Congress has permitted the most fortunate in our society to pass up to $2 million dollars to their children and heirs without paying any estate tax and continues to discuss eliminating the estate tax completely.

     It has been said that a society can be judged by its treatment of its most vulnerable - its children and its elderly. A stroll through the nursing homes in America should give us pause. The Deficit Reduction Act should make us question our priorities.


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Wendy A. Craig

Wendy A. Craig, P.A.
Concentrating in Elder Law for Western North Carolina

207 East State Street, Black Mountain, NC 28711
828-669-0799 (Voice) • 828-669-0055 (Fax)

E-Mail Address: Email Me



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