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The babe roar generation—born between 1946 and 1964—is bearing down on America's retirement programmes like a pre-climate alteration glacier. More than 78 million strong, the babe roar looks destined to oppress every societal programme in its path. It cannot be stopped. Only a mixture of authorities and private solutions, such as as private long term attention insurance, can debar the approaching disaster.

Today, with the babe baby boomers still in the work force, there are 3.3 pay wage earners for each individual collection Sociable Security benefits. That figure will shrivel as the babe baby boomers retire and get collecting Sociable Security benefits. By 2031, there will be only 2.1 pay wage earners for each Sociable Security beneficiary.

With the baby boomers working and paying taxes, the Sociable Security trust finances are running a surplus. That volition go on until 2016. At that point, with one-half the baby boomers collecting Sociable Security, the taxations flowing into the trust finances will not be as great as the outgoes flowing out. At first, nil will change. Sociable Security will utilize the involvement earned during the excess old age to pay benefits. By 2041, however, the surplus finances will be depleted. Incoming paysheet taxations will cover only 75 percentage of the costs.

The crisis in long term attention will develop more than quickly. The U.S. Census Agency estimations that 72 million baby boomers will dwell past age 65. According to the American Association of Homes and Services for the Aging (AAHSA), a non-profit-making grouping that surveys older care, 69 percentage of people living past age 64 necessitate some sort of long term care. If the per centum holds, then 49.6 million baby boomers will necessitate long term care.

The cost of the attention will be enormous. AAHSA studies that a private room in a nursing place costs an norm of $74,600 a year. The norm stay is 2.4 years. If everything remains the same (and costs are likely to rise, even in today's dollars), the cost of the boomers' long term attention will number $8.88 trillion over 19 years, or $467 billion a year.

Nearly 60 percentage of the baby baby boomers believe that Medicare pays for long term care, according to studies conducted by AAHSA. This is incorrect. Medicare pays for post-hospitalization rehabilitation, but not long term care. Right now, people and coverage wage for 51 percentage of long term care. The other 49 percentage is paid by Medicaid, the authorities programme for the needy.

If those percents stay unchanged, the baby boomers will flop Medicaid. To debar the crisis, United States Congress is limiting Medicaid eligibility. That volition not be enough, states U.S. Congressman Phil Gingrey, M.D., of Georgia. He writes, "Congress must attach to Medicaid reform with meaningful inducements for buying long term attention coverage."

With long term attention coverage the insured pays a monthly premium, and the insurance company holds to pay for long term care. According to the AAHSA, the norm long term attention coverage policy pays out 82 cents for every dollar spent in premiums. The norm yearly long term attention insurance premium for people under 65 is $1,337. Individuals over 65 wage $2,862. Even without authorities incentives, it do sense for baby boomers to sign-up early for long term attention coverage sooner rather than later.