Scarecrow laws threaten to make middle-aged Americans responsible for their parents’ medical bills amid soaring long-term care costs

Scarecrow laws threaten to make middle-aged Americans responsible for their parents’ medical bills amid soaring long-term care costs
Scarecrow laws threaten to make middle-aged Americans responsible for their parents’ medical bills amid soaring long-term care costs

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Two facts have become impossible to ignore: The U.S. population is aging, and the cost to take care of our seniors is surging.

By 2030, all 73 million baby boomers will be 65 years of age and older. The number of Americans ages 65 and older is projected to increase from 58 million in 2022 to 82 million by 2050, according to the Population Reference Bureau.

Meanwhile, long-term care costs are rising too, and a patchwork of solutions are to be relied on as Americans age and cannot live independently.

Recent reporting by Forbes shows how forgotten "scarecrow" laws could bankrupt the families of elderly receiving care.

So what can you do in the face of changing laws and rising costs?

‘Scarecrow’ laws

According to Forbes reporting, over half the states currently have laws holding adult children financially responsible for the care of their senior parents. This may include nursing home, medical and other bills. These are old laws that are rarely enforced but are retained as a warning to ensure good behavior.

However, 2012 and 2019 cases in Pennsylvania showed that these “scarecrow” laws could threaten the financial futures of middle-aged children. According to ABC News, in 2012, John Pittas was forced to pay for his mother's nearly $93,000 nursing home stay after her Medicaid application was not approved in time.

This has led Democrat state Rep. Kristine Howard to sponsor a bill called Stop Bankrupting Pennsylvanians Over Family Medical Bills Act.

“Pennsylvania’s outlier status in this regard is shameful,” Howard wrote in the bill memorandum in March. “Given that Pennsylvania nursing homes average a cost of nearly $400 per day, this can quickly lead to bankruptcies.” When it comes to digging your way out of debt, Americans could use all the help they can get. And a debt consolidation loan could be the way to make paying it all off faster and easier.

Opting for a personal loan through Credible could help ease the burden by consolidating those bills and speeding up your repayment process.

Credible is an online marketplace connecting you with vetted lenders, making it easier to explore loan options available to you. Credible will show you rates from up to 7 lenders without affecting your credit score.

Long-term care costs

“Most adult children do undertake responsibilities for their parents as they age and especially if their parents’ abilities wane,’’ said Katherine C. Pearson, an elder law expert, to Forbes. “They do this because it is the right thing to do. They do this without laws obligating them to do so, thank goodness.”

But the costs to pay others to take care of elderly parents can be exorbitant. Statistics compiled by the National Council on Aging show a wide variance of median monthly nursing home costs — from a low of $5,931 in Missouri to an astounding $31,512 in Alaska. This means elder care in Alaska costs a total of $378,144 annually, just shy of the median list price for homes in Anchorage ($439,000).

Adult children of boomers face tough questions and tougher choices. Among the most gripping: How can they afford nursing home bills? And what happens if the money runs out — not just to their elderly parents but also to the family finances?

There are things you can do to help mitigate some of these costs for yourself and your family.

If you want to safeguard your family's financial future, GoldenCare’s long-term care insurance can help get you things like nursing homes, assisted living and other daily living aids covered, so you don’t have to pay out of pocket.

While traditional health insurance covers certain medical needs in old age, such as prescription and doctor visits, long term care insurance covers health needs specific to old age, like assistance with baths or meals.

All you have to do is fill in a bit of information about yourself and GoldenCare will provide you with a free quote that fits your needs and budget.

Life insurance can offer a versatile solution to help support your family, providing coverage to potentially replace lost income or settle outstanding debts in the event of your death.

Opting for term life insurance through a provider like Ethos, ensures that as you age, your loved ones are protected from unexpected costs. With term life insurance, you can secure affordable coverage while managing your other financial responsibilities.

Ethos offers an easy online process that allows you to get up to $2 million in coverage with terms spanning from 10 to 30 years. To get a free quote, simply answer a few questions about yourself. Then, you can compare various coverage and choose the policy that best aligns with your needs.

A patchwork of solutions

For some families, relocation might be an option, especially if the overall cost of living in a given state is also cheaper.

Private long-term care insurance is another defense against runaway costs. However, Forbes notes that “a raft of carriers have stopped selling the policies because the risk is so high — and healthy consumers aren’t buying policies because they fear premium increases.”

Medicare doesn’t pay for long-term care unless skilled nursing services are required — and even then it’s only for 100 days.

Having a healthy emergency fund is the best solution for those looking to defray future medical bills.

SoFi checking accounts are a secure avenue to boost your bank account and help you save on fees.

With SoFi, you can earn competitive rates of 4.60% on savings balances and 0.50% on checking balances with direct deposit. SoFi ensures peace of mind with FDIC insurance covering deposits up to $250,000, safeguarding your funds. If you sign up with SoFi today, new account holders qualify for cash bonuses up to $300 by setting up direct deposit.

While the national interest rate averages a 0.58% APY, a high yield savings account can give you more competitive rates for your nest egg.

Check out our list of the best-high yield savings accounts for 2024 to find the best option for building that financial safety net.

This article provides information only and should not be construed as advice. It is provided without warranty of any kind.