Elder law is another aspect of estate planning, focusing primarily on the needs of families and individuals as they age. Issues of aging include finding suitable senior housing, which often includes home care options or institutionalized care. Other aspects of Elder law include guardianships, healthcare documents, as well as planning for government assistance through programs such as Medicare and Medicaid.
The Long Term Care Dilemma
As our population ages, more and more of us confront elder law-related issues, whether for ourselves or our parents. One of the most pressing issues is long-term nursing home care, which usually is not covered by traditional health insurance. Depending on where you live and the level of care needed, nursing home care costs can vary greatly. In 2019, the national median cost for a private room in a skilled nursing facility was $102,200. The average stay is slightly more than two years. Most people end up paying for nursing home care until their personal (or family) assets are depleted, then they may qualify for Medicaid to pick up the cost.
Careful planning, however, can help protect your assets, whether for your spouse or for your children. The belt-and-suspenders approach is to purchase long-term care insurance while you are healthy enough to qualify, and to make sure you receive the benefits to which you are entitled under Medicare and Medicaid.
Medicaid is a division of Social Security. It is a federally funded, but state-administered, program designed to provide care to those 65 and older who are medically and financially eligible. Medicaid is a needs-based system that pays the cost of nursing home and/or in-home care for those who cannot pay for themselves.
Medicaid eligibility is determined after the proper application is submitted to the state. There are many Medicaid programs available, from in-home care options to nursing home programs.
The Massachusetts Department of Elder Affairs provides a wealth of information for seniors and caregivers.
We assist seniors and their families in making the tough decisions regarding long-term care planning, including whether Medicaid eligibility is appropriate.
Clients are frequently confused over the differences between Medicare and Medicaid. Though their names are very similar, the programs are quite different. Medicare is an “entitlement” program, a federal health insurance program in which most people enroll when they turn 65 years old. There are no financial qualification rules. Medicare has two primary parts: Part A and Part B.
Medicare Part A covers in-hospital care, extended care after a hospital stay, some home health care services, and hospice services. The rules for nursing home coverage are very strict and, in fact, Medicare pays for less than nine percent of nursing home care in this country.
Senior Housing Options
Helping a parent move to senior housing can seem more intimidating than orchestrating a rocket launch. The death of a spouse, declining health, or safety concerns can trigger the need to move. The first phase comes with the realization that what has been home is no longer suitable. Emotional ties to a place are hard to overcome. Finding a new home that is appealing and appropriate is no easy task, and neither is culling through a lifetime's accumulation of "stuff."
Here are some tips to help make the transition easier:
- Plan ahead. Don't wait for a health crisis to start the process. The smoothest transitions occur when the person moving is in the driver's seat.
- Get a full assessment of the current situation. Physical care needs and financial resources are where to start. Consider the costs of staying in place, including renovation and ongoing maintenance. Add the cost of rising utility bills and taxes, and don't forget transportation and food. Make a list and decide whether it's cheaper to stay or move to a community designed for seniors.
- Take a multi-phase approach. Seniors often take longer than a year to actually make the move.
- Fully explore new housing options. Senior living offers a broader range of options than ever before.
Medicaid Crisis Planning
Sudden Changes and Big Decisions
Change is life’s only constant. Sometimes these changes strike without warning. If you or a loved one has experienced a sudden illness or serious accident, you understand how abruptly everything can change. Are you or a loved one suddenly in need of nursing home care? Finding and affording quality care on short notice can be stressful and draining. We can help you determine the best options for care and how to qualify for Medicaid to help finance them.
Long-Term Care: Counting the Cost
Long-term care is expensive, and these costs only continue to increase as baby boomers age. Although the range varies depending on where you live, according to the Genworth Cost of Care Study for 2019 the national median annual cost of a private nursing home room is $102,200 with a 3% annual increase projected. With improved medical care, the average life span of adults also is increasing; this translates into more years of care at increasingly higher rates. Without some sort of financial assistance, these costs could be financially devastating. In fact, your entire life savings could be quickly depleted within a few years of needing long-term care. This is where Medicaid can help.
Medicaid is a joint federal and state program to assist those with low income and limited resources. While Medicare provides very limited long-term care coverage, Medicaid is much more extensive. However, because of its restrictions, qualifying for Medicaid can be extremely difficult. But paying for a nursing home without it could be all but impossible.
The Medicaid Maze
To qualify for Medicaid, the applicant must be both medically and financially eligible.
To financially qualify for Medicaid:
- In Massachusetts, the applicant must have no more than $2,000 in countable assets on the date of application. In Connecticut, however, the maximum amount of countable assets the applicant can retain is $1,600;
- The Community Spouse (or colloquially known as the “well spouse”) must have no more than $119,220 in countable assets;
- The applicant may retain one personal residence and one vehicle, but such assets may be subject to estate recovery.
To medically qualify for Medicaid the applicant must be unable to perform at least two of the following without assistance:
- Bathing, dressing, eating, toileting, and/or transitioning from room to room;
- A diagnosis of dementia will also render an applicant medically eligible.
This is only a brief and oversimplified review of a few Medicaid rules, of which there are myriad more. Navigating them on your own could be a nightmare at best and subject you to penalties at worst. Fortunately, though, our experienced professionals can guide you through the Medicaid maze. We can advise you throughout the application process, ensuring that you retain the maximum income and total assets allowed by law.
Seek appropriate counsel before you apply for and seek to qualify for Medicaid. We can give you – and your family – peace of mind during a difficult and uncertain time. When dealing with Medicaid, legal advice is something you cannot afford to go without.