From Our Friend Stephen Moses: LTC E-Alert #9-072: MetLife and NCOA on HEC
LTC E-Alert #9-072: MetLife and NCOA on HEC
Tuesday, June 23, 2009
Seattle–
LTC Comment: Kudos to the MetLife Mature Market Institute (www.maturemarketinstitute.com) and the National Council on Aging (www.ncoa.org) for their new, jointly published report on reverse mortgages.
Read a summary below. See the full report here.
Reverse mortgages are rarely used to fund long-term care. We’ve established that fact repeatedly by interviewing lenders in our state-level studies of long-term care over the years. Examples here.
There is a simple reason why reverse mortgages don’t help many aging homeowners obtain quality long-term care. Until the Deficit Reduction Act of 2005 capped Medicaid’s home equity exemption at $500,000 to $750,000, Medicaid LTC recipients could retain one home and all contiguous property with no limit on the value. Even now the most common $500,000 limit is roughly four times the median value of the average elderly family’s home. But get this: our half a million dollar limit is nearly 15 times the size of the home equity exemption in the United Kingdom’s long-term care system ($35,000). We’re more generous with our welfare-financed long-term care than a socialized health care system in Europe.
