In recent weeks we’ve had a spate of reporting from the Associated Press, New York Times, Wall Street Journal, and all the other major news sources on Medicare and its trust fund.

An August 6, 2010 Associated Press article by Stephen Ohlemacher and Ricardo Alonso-Zalidvar states that according to the annual report by Medicare and Social Security trustees, Medicare will have enough money to run a dozen years longer than earlier projected.

Top Medicare actuary Richard Foster warned that the report’s financial projections “do not represent a reasonable expectation.”

Kathleen Sebelius, Secretary of Health and Human Services and one of the trustees, said the report was based on proposed cuts in Medicare payments, which she doubts will happen.

Related articles point out that job loss and the current recession are causing people to collect Social Security sooner than anticipated. They also note that health care reform includes reducing payments to Medicare providers and reducing future Medicare spending.

If you don’t own long-term care insurance, I hope information like this will prompt you to act accordingly and buy it now. It should be obvious that the government can’t—and won’t—pay for your long-term care.

When reasonably priced long-term care insurance is available, why would you ever want to self-insure for long-term care in such uncertain times?

The nation’s total federal debt next year is expected to exceed $14 trillion — about $47,000 for every U.S. resident.

Republican Alan Simpson, the former Republican senator from Wyoming, and Erskine Bowles, the former White House chief of staff under Democratic President Bill Clinton, head an 18-member commission assigned to come up with a plan by Dec. 1 to reduce the government’s annual deficits to 3 percent of the national economy by 2015.

”This debt is like a cancer,” Bowles stated at a meeting of the National Governors Association this month.

In a July 12, 2010 Associated Press article reported by Glen Johnson, Bowles and Simpson said that everything needs to be considered — including curtailing popular tax breaks, such as the home mortgage deduction, and instituting a financial trigger for gaining Medicare coverage.

So if your long-term care planning included current government benefits and tax breaks to help you self-insure, you would be wise to reconsider.

The following 3 articles hit the news Thursday and Friday of this week. The message here: it’s unrealistic to expect the government to be able to pay for long-term care. Long-term care insurance needs to be a core part of your financial planning. 

The total federal deficit is expected to exceed $14 trillion next year – about $47,000 for every US resident.

Medicaid rolls swell by 3.3 million nationwide By Catherine Candisky, Columbus Dispatch. Feb 18, 2010, Between June 2008 and June 2009, Medicaid enrollment rose by 7.5 percent and all 50 states saw increases, according to an analysis released Thursday by the Kaiser Family Foundation’s Commission on Medicaid and the Uninsured. Medicaid currently pays for approximately 50% of long-term care in the US.  

States consider Medicaid cuts as use grows By Kevin Sack and Robert Pear, New York Times. Feb 19, 2010 States are already unable to make budgetary ends meet with the influx of Medicaid recipients resulting from the country’s economic woes, yet health care reform could add more than 15 million more people to the rolls. Many states are considering cutting vision and dental care which are considered optional benefits, and some other states are discussing new taxes on tobacco or levies on doctors and hospitals.

Deficit panel: Budget cuts will hurt By Andrew Taylor, Associated Press, February 19, 2010. In a poisonous legislative atmosphere, almost no one is willing to go on the record with budget solutions like raising the Social Security retirement age, ordering broad-based tax increases, or increasing co-pays and deductibles for Medicare. On Thursday, President Obama created the new National Commission on Fiscal Responsibility and Reform, charged with coming up with a plan by December 1, 2010 that will reduce the government’s annual deficits to 3 percent of the national economy by 2015.