About two-thirds of people who file for bankruptcy in America do so because of medical debts. Older Americans, who face high healthcare costs and often live on fixed incomes, are particularly vulnerable.
A new law that expands Washington’s charity care program may ease this financial burden for many seniors in the state.
What the law does
Legislation that took effect on July 1, 2022, requires large hospital systems to provide a higher level of financial assistance to residents of the state who qualify. An estimated four million people in the state may qualify for free or discounted care.
Who qualifies for assistance
Washington state residents whose income is between 0% and 300% of the federal poverty level will have no out-of-pocket costs at the majority of Washington state hospitals. People with incomes that are between 301% and 350% of the federal poverty level will receive a 75% discount and people in the 351% to 400% income bracket will get a 50% discount.
Impact of the law on estate planning
Planning for healthcare costs is an important component of any estate plan. The high cost of healthcare can erode many seniors’ savings, leaving them reliant on Medicaid and other programs for healthcare. Seniors who qualify for free or discounted healthcare may be able to reduce their overall medical costs, leaving more money for other expenses, such as long-term care.
Many seniors who face rising healthcare costs on a fixed-income stand to benefit from this expansion of the charity care program. However, it is still important to plan for healthcare expenses as you age.