What is Elder Law and how can working with an Elder Law Attorney benefit me?
Elder law is an area of law that takes many factors into account. An elder law attorney should be familiar with various areas of law in order to help you come up with a plan that will help you meet your goals as you age.
This plan can include:
A Power of Attorney and Living Will that will help you to have more control over your health and financial decisions in the event that you have limited capacity to make decisions in the future.
An Estate Plan that will help to direct where your assets go and can help you and your family to keep more of the hard-earned assets that you’ve acquired throughout your life. This includes reviewing and revising your Will and Beneficiary Designations to make sure that you are not giving the government more assets than you need to.
Long-term care planning that helps you make the most of programs like insurance, Medicare, VA Benefits and Medicaid and allows you and your family to keep as many of your resources as possible.
Help applying for programs like Medicaid. Application mistakes or even bad timing with the application can cost thousands of dollars.
Reviewing Care Contracts, for example, nursing home contracts to ensure that you are not unnecessarily giving up any of the rights that you are entitled to and to make sure that you are not putting anyone like children, spouses or other loved ones at risk of payment liability.
Reviewing your situation and understanding your goals in order to determine other ways to save you or your loved ones money and frustration.
What is Long-Term Care and why should I be concerned.
It is estimated that 75% of all people between 75 and 80 years old will need some form of care and that 1/3 of men and women in that age group will need extended care.
Care can include in-home care, assisted living, personal care and nursing homes. Extended care typically involves an extended stretch in a nursing home. This can be costly as Medicare coverage typically only covers short stretches in a nursing home under specific circumstances (i.e. recovering from an injury). Because Nursing Home care can typically costs $10,000.00 or more per month, most people cannot typically afford an extended period in a nursing home on their own. In these cases Medicaid is typically the best option to help people afford the care that they need.
How does Medicaid help with long-term care costs and how do I qualify?
In order to qualify for Medicaid benefits, nursing home care must be declared medically necessary by a physician (who must fill out the appropriate forms) and a person (and their spouse, if married) must also qualify financially. Once qualified, Medicaid pays a calculated portion of your expenses, allowing you to keep a specified portion of your assets and income, while you put the rest toward payment to the nursing home.
I’ve heard that I have to give up everything in order to receive Medicaid benefits, is this true?
This is not true. Medicaid allows those with up to $2,199 per month in income to keep up to $8,000 in countable assets. Those with over $2,199 in monthly income can only keep $2400 in countable assets. These income numbers are based on gross income, so check withholding. The income numbers also count assets whether solely or jointly owned, including by husband and spouse. A joint checking account with your child would typically also count towards your income limits.
Are there assets that don’t count toward my countable assets?
Yes, some of these items include one car (between you and your spouse), one house (up to a certain value), burial plots and markers, money set aside irrevocably for funeral costs, DRA qualified annuities, certain types of life insurance, and a spouses IRA. Please note that many of these items have very specific definitions and the sometimes the timing of purchasing these items can save or cost you additional money, so speaking with an elder law attorney is definitely recommended. Keep in mind that Medicaid’s breakdown of assets and income can be different than other entities (such as the IRS).
Can the government take some of these assets in order to pay for Medicaid?
Yes, current Pennsylvania law has what is called the “Estate Recovery” program. Under this program, probate-eligible assets can be recovered by the government up to the amount that Medicaid has paid for your care.
Is there anything that I can do to protect these assets?
Yes, depending on the timing you may have several options including putting items in trust (specifically an irrevocable trust), changing the will of you and/or your spouse and changing beneficiaries on things like life insurance policies. Again, these things must be done in specific ways. Doing them incorrectly or at the wrong time could cost you thousands.
Why can’t I just give away my assets in order to qualify for Medicaid?
This can result in the worst of both worlds. Gifts within a 5 year “look-back” period make you eligible for a penalty. Once you do qualify for Medicaid, there is a penalty period in which you have to pay the costs on your own. This is determined by dividing the penalty amount by a $330/day “divisor”. This will give you the amount of days in which you are in the penalty period and must pay your own costs and remember this is after you have “spent down” your assets in order to qualify for Medicaid, so you won’t have a lot of money available to pay. Proper planning can help to avoid or defray some of these costs.
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