Urgent ObamaCare Warning for Lower Income Folks 55 and Over

Attention lower-income adults 55+ in the USA - you may be forced onto Medicaid under ObamaCare! That’s right - if you're uninsured and your income qualifies you for Medicaid, you don’t have a choice.

Health care at no cost to you – what’s not to like? Well, it’s called estate recovery. And if you end up a member of a managed care organization it’s even worse. And where I live, everyone on Medicaid is managed by Partnership HealthPlan, which is a managed care organization that administers California’s Medicaid program, known as Medi-Cal, in some counties.

Well, here’s a little tidbit from Partnership HealthPlan’s Member Handbook, page 18, “The State of California must seek repayment of Medi-Cal benefits from the estate of a deceased Medi-Cal beneficiary for services received on or after the beneficiary’s 55th birthday. For Medi-Cal beneficiaries enrolled (either voluntarily or mandatorily) in a managed care organization, the State must seek recovery of the total premium/capitation payments for the period of time they were enrolled in the managed care organization. Additionally, any other payments made for services provided by non-managed care providers will also be recovered from the estate.”

If you’re going to die with nothing, I guess this doesn’t affect you. If you’ve worked and saved to amass a few assets to leave to your kids despite the fact that your income happens to be under 138% of the federal poverty level, you’re screwed. Well, I guess technically it’s your kids that are screwed.

But don’t take my word for it. I’m no expert and it would be nice if someone could prove all my research has been in error. Just do a Google search for ‘Medicaid estate recovery’ and see what you find. But be sure to dig deep and also find what the rules are in your state – some just recover for long-term care as required by the feds while others (like California) recover for everything. And be sure not to confuse Medicaid with Medicare, which currently isn’t part of the estate recovery scene.

Bottom line is that if you are 55 or over and get signed up for Medicaid, whether voluntarily or not, you are agreeing to your state recovering anything spent on your behalf through the program. Even if you NEVER use Medicaid one time, if you're a member of a managed care organization, you will be accruing indebtedness to the state each month (through capitation payments for your managed care) that may be recovered from your estate. So before you apply for your mandatory ObamaCare, you’d best be figuring out whether you’re going to be forced onto Medicaid and what your long-term consequences are.

So...what's your plan for dealing with ObamaCare?

Debit or Credit - Which Card Should You Use?

Debit and credit cards are both convenient ways to pay for things without carrying cash. The beauty of using a debit card is that you are spending your own money in real time rather than borrowing it from your credit card company at what is most likely an exorbitant interest rate. I rarely use my debit card, however, except to withdraw money from my bank. I also NEVER pay interest. Let me explain.

I use my VISA credit card to pay for most everything that I can, including our car and home insurance, vehicle license renewals, etc. I then pay the balance IN FULL and on time each month, avoiding interest and late fees. My account has no annual fee and even earns points based on the amount spent, so each year I actually get a little back. But even if I got nothing, I’d still use my credit rather than my debit for one simple reason:

Fraudulent Charges

That’s right – fraudulent charges. I have two family members who recently dealt with fraudulent charges on their debit cards. Although unrelated, at different banks and months apart, both had charges of several hundred dollars originating in the UK hit their bank accounts. In both cases, the charges were obviously fraud but still took quite a bit of time and effort to resolve. We’re talking several phone calls, personal trips to the bank and paperwork. In the meantime, they were out the money – not a good thing if you have bills to pay.

In contrast, I noticed fraudulent charges on my VISA credit card account a while back. A simple phone call resolved the problem – the charges were immediately reversed and I was out nothing, not even for a minute. I also had the option of taking care of the problem online. I did have to wait for my new card to arrive (and I had my old number memorized – dang!), but that was the only inconvenience.

Should YOU Use Credit Instead of Debit?

So is using a credit instead of a debit card right for everyone? Only if you use your credit card like you would your debit card and spend only what you can pay in full each month. If you don’t have the self-discipline to do so, I guess you'd better stick with the debit card.

How to Transform Your Relationship with Money

I was cleaning today and ran across some old files from a decade or so ago. In the mix was a bunch of worksheets detailing my finances at the time - to the penny - for over a year. I also found graphs and other cool stuff I’d forgotten that I’d done. Fortunately I found a reference to creating a new road map and did a quick Internet search, which revealed that I had undertaken a very cool process presented in “Your Money or Your Life” by Vicki Robin and Joe Dominguez.

My Life HAS Changed
Although it was a time commitment, reading the book and actually completing the exercises did transform my relationship with money. At the time, I was working in an office and in debt - nothing too serious - mortgage, car payment, some low credit card balances, and maybe some student loan payments. Now I owe no money and can work at home when and if I choose. Life has certainly improved since I took the advice in the book to heart and started valuing my life energy.

Looking back on the facts and figures, I am blown away by how different things are now. And also by how easy it is to forget previous details. But my handwritten income and expense sheets don’t lie. I think I’ll see if I still have a copy of that book around here somewhere. And if not, maybe I’ll check one of my book swap sites. I don’t think I really need it much now but it might be fun to read again anyway. And if I decide to do the exercises with the detailed accounts and graphs, it will be so much easier this time!

Get the Book!
Anyway, get a copy of this book. And I suggest you actually buy one (fyi - book image is an Amazon affiliate link). Anyone who has read this blog at all knows that I usually recommend borrowing from the library or a friend to save money, but this book is an exception. You just can’t digest it in one or two readings.

Now get busy and change the way you look at, think about, and act toward money!

Would You Rather Look Rich or Be Rich?

I just ordered a book by Stacy Johnson titled “Life or Debt 2010: A New Path to Financial Freedom,” which I discovered in “My 10 Dumbest Money Moves - And How You Can Avoid Them.” I raced to Amazon and ordered the book due to a quote under mistake number 3: Attempting to derive self-esteem from possessions, “You can either look rich or be rich, but you probably won’t live long enough to accomplish both.”

Think about that for just a minute. How much money have you squandered on appearance? What could you have done with that money instead? Are you sacrificing your future security to buy trendy clothes, a fancy car or more house than you can afford? Owning nice things is wonderful - IF you can afford them. But if owning nice things means payments over time, then you don’t really own them - they own you.

Now, I’m not saying that all debt is bad. I know that a mortgage is the only way most people will ever own a home; I’ve had a few mortgages myself. An education is also an investment in the future that may be worth financing. Just be realistic about what you can afford and err on the side of caution. Buying a modest house or attending a local college will usually accomplish the same goal at a much lower cost.

Back to the book. No, I don't really need it as we've been completely debt free for nearly a decade - but I love reading and passing along this kind of book. Yes, I’ve included an Amazon affiliate link for your convenience. However, when you get to Amazon, check out the available used copies. I just ordered mine for $5.76 including shipping, which is well below the price of a new copy. Better yet, although it wasn’t an option for me, check your local library and borrow the book for free. Happy reading!