The cost of long term care will be the greatest threat to your home and finances.
7 out of 10 people will need some type of long term care. Nursing home care costs are astronomical, and rise every year.
In 2020, the average cost for a nursing home in the Boston, Massachusetts area was $14,509 per month. (Source)
Private in-home care is even more expensive, with 24-hour care costing $21,840 per month. The average senior needs care for about three years, costing $522,324– $786,240.
The costs for long term care will threaten your home and finances. It’s unfortunate that many seniors are paying the full price for nursing home care out of pocket. Even after years of disciplined saving, nursing home bills or in-home care costs can quickly deplete your bank account in a matter of months.
No. Medicare does not cover nursing home care except in limited circumstances.
People are often confused over the differences between Medicare and Medicaid. Though their names are very similar, the programs are quite different.
Medicare is an entitlement program in which most people enroll when they turn 65 years old. There are no financial qualification rules.
Medicare Part A may cover a short term stay (up to 100 days) in a skilled nursing facility, but the rules for coverage are very strict. You must first have a qualified hospital stay, and the facility must admit you for the illness or injury that you were receiving hospital care for.
Medicaid is the largest provider of financial assistance for nursing home residents in the United States. Medicaid is a joint federal-state program. In Massachusetts, it is known as MassHealth Medicaid.
There are strict laws for Medicaid eligibility to pay for long term care. There is an asset limit, and in order to be eligible, one must have assets under the limit. Eligibility is determined after the proper application is submitted to the commonwealth of Massachusetts.
Many people think they can simply gift their money, property, and other assets away to loved ones to become eligible for Medicaid. That is not true. Once you apply, the Medicaid office will review all asset transfers from the previous 5 years (called the look-back period).
Asset transfers or gifting must be done properly, with the aid of an attorney. Severe penalties are imposed on improper gifts including the denial of benefits for several years.
The process of applying for and receiving Medicaid benefits is extremely difficult and time-consuming for the applicant. However, with appropriate planning, we can help you become eligible for Medicaid while still protecting your nest egg that you’ve built over your lifetime.
It’s never too late to protect your life’s work. When we sit down with you, we discuss your goals and look into the future to develop a complete plan that protects you for generations to come.
At Patrick J. Kelleher & Associates P.C., we assist seniors and their families in making the tough, but necessary decisions regarding future long-term care needs.
Our proactive planning techniques protect your assets from Medicaid eligibility and recovery. We can also help if the time for advanced planning has passed. Our crisis planning techniques can manage your assets when your loved one is already in a nursing home, and immediate Medicaid eligibility is needed.
We would be honored to help you and your loved ones. Click here to get started.
Thankfully, you do not have to spend all your money. However, Medicaid does have strict requirements for income and assets, so you should be mindful of your assets and how Medicaid views them.
Luckily, there is a non-countable category for Medicaid. Therefore, they most likely will not count your primary residence, car, and personal items against you when you apply.
Further, having a healthy spouse can be beneficial. They can keep a portion of your assets while still allowing you to apply for Medicaid.
If your assets and possessions exceed what is allowable, then careful planning is necessary. You may be able to transfer assets or provide gifts to your loved ones before the five-year lookback period. Plus, setting up a Trust is a strong option.
No, Medicare and Medicaid are two different government entities, and what they do to help you will be different.
Medicare is a health insurance program for individuals 65 and older, and there is no requirement other than your age. Certain parts of Medicare may provide short-term stay assistance in a skilled nursing facility. Still, there are strict requirements for this kind of care.
Further, Medicare will not pay for long-term care. So if you or a loved one ends up in a nursing facility through Medicare, there may be very short notice when coverage stops.
If further care is needed, it is vital to have the next step in place. Medicaid or Veteran’s Benefits can step in when promptly applied for so that no one is left scrambling and care can be continued smoothly.
We suggest that you do not do this and instead consider creating a Trust. If you have a child listed on a bank account, then upon your death, your account will automatically go to your child. While this may not automatically be a concern for you, please consider this.
If there are others you wanted to have access to the funds in your account, they may be cut off from them. Whoever is listed on the account could take the funds and use them for their own purposes.
The other big concern is part of the Four-headed Monster: creditors, and predators. If there are creditors or predators after your child’s assets, your bank account will now be exposed to these people, and the funds in your account may be drained.
Suppose you become incapacitated or unable to be cared for at home, and you have to go to a nursing home. In that case, the five-year look-back period may apply to you. Due to the costs of nursing homes, many people need the assistance of Medicaid and apply for it upon going to the nursing home.
Medicaid will review your application and “look back” at least five years into your financial history. They will look for transfers of ownership of any asset to a non-spouse or if you gave money away to children or grandchildren.
If you have done this, then Medicaid may have an issue. There is a strong chance that they will deny Medicaid benefits to you until this penalty is cured. It can be fixed by time, the asset being transferred back to your name, or the gift returned.
It is imperative to get the planning done before you or your loved one is at the nursing home doors.
The questions and the answers you receive can significantly impact who you choose and how confident you will feel in your planning through the later stages of life.
Here are some potential questions to ask to help you make the decision on who you want to hire:
Having an experienced elder law attorney can be a great asset and an excellent resource for removing stress from your life. Further, they can save you and your family money and time. Please consider our firm for your elder law needs.
There is a wide range of legal fees regarding Elder Law due to the various issues among families and their estates. Many law firms typically charge a flat fee to help with Medicaid applications, but filling out the application is only part of the process. To be most effective in making sure you qualify for Medicaid, strategic estate planning may also need to occur.
If you have a smaller estate, no home or automobile, it may only require some simple planning. There may be options for spending down the smaller estate, such as getting an Irrevocable Funeral Contract. The key is making sure that the size of the estate and the income is where it needs to be for qualification.
If you have significant assets, this may require more robust planning to help you properly qualify for Medicaid. Spending down is still an option. However, further steps may need to be taken to protect assets and property through a Trust.
After the planning is complete, keeping the attorney on hand to fill out the Medicaid application can be very important. One wrong box checked could cause further issues and out-of-pocket costs to you or your family.
The best action to take is to work with an experienced and qualified attorney familiar with the Medicaid program. Once you have sat with them, they should be able to tell you the cost.
The best time to hire an Elder Law Attorney is when you enter the third quarter of life, perhaps even half time if you want to be a good planner. Do not wait until you’re in the late part of your third quarter of life, as you will put yourself and your family in precarious situations.
The best time to plan is when you are alive and well. This allows you to participate in and be responsible for the crucial decisions that may need to be made if you cannot be heard due to disability and incapacitation.
We have created an acronym: SADD.
S: Safety. Suppose there is falling, sleeping too often, or an inability to keep balance. In that case, this is a strong indicator that they should no longer be home alone. It is definitely recommended to have a safety necklace or bracelet and even have cameras installed to ensure they are alright.
A: Alzheimer’s. If someone you love has been diagnosed with this disease, they should not be living at home by themselves.
D: Disability. If your loved one has a disability that makes it hard for them to accomplish daily living tasks, such as walking, bathing, or getting dressed, they should not be alone.
D: Dementia. There are various levels of dementia, but if they have moderate to severe dementia, this may be a sign for them to be placed in an assisted living facility or skilled nursing facility.
If you feel that your loved one meets one of the criteria, you may need legal power to help them. Please contact our office today to see how you can do this.
Your family should be involved; however, providing them direction is essential. With an Elder law plan in place, the grief and stress on the family will be reduced. This is helpful because certain parts of personalities in your family usually are exacerbated or worsened during these times of stress, which leads to tension and disharmony.
We suggest having a family care meeting where you invite the important members of the family, especially those designated in your documents. During this meeting, it is necessary to have the three keys; good communication, transparency, and respect. There should be no hidden agendas or stonewalling, and everyone’s voices should be heard. At the meeting, all can be explained, and hopefully, this prevents any future concerns for you and your family.
This is the best way to have family harmony and avoid harm.
Unfortunately, we will likely encounter some form of medical issue or disability as we get older. This may interfere with our ability to make personal life decisions. Therefore, everyone needs a meaningful disability plan, including certain essential documents, to avoid causing stress on our family when they need to step in.
The first is a Durable Power of Attorney with enhanced elder law powers to help with financial decisions. Next, the Healthcare Proxy is needed to have someone help make medical decisions for you. Further, the Advanced Medical Directives provide direction for what you want to happen if incapacitated.
Finally, a HIPPA authorization, a Living Will or D.N.R., a Spoonfed Directive, and a MOLST/POLST are critical to have in place to help with various medical issues that may arise. For example, this could be your family needing a second opinion or whether you want the medical personnel to resuscitate you or let you pass on when the time comes.
With the use of these documents and the careful choosing of someone you trust to put the language in these documents into action, any health issues you may encounter will be handled with ease for you and your family.