Long-Term Care Planning
Nursing home costs in Missouri can easily exceed $75,000 per year and often is the cause of great hardship to people who have worked hard their whole lives to have a retirement nest egg and now face the problem of paying for long term care. Planning with an Elder Law attorney can often avoid the financial problems that long term care expenses can cause. Planning for these needs with the advice of someone knowledgeable in the laws governing Medicaid eligibility can avoid financial distress and provide a significant portion of the family assets for use as a spouse’s living expenses.
Will I need Long Term Care?
US government statistics calculate that between 60% and 70% of us who are over 65 will spend some time in Long Term Care.
Who will provide the care?
Almost everyone prefers to be cared for at home and over 50% of the people who need Long Term Care will receive it at home from their families – spouses, children and Home Care professionals.
How many of us will receive Long Term Care in a Nursing Home?
Over 40% of us will receive Long Term Care in a Nursing Home. About 11% of us will be in the Nursing Home (Skilled Care Facility) up to three months rehabbing an injury or at the very end of life. About 8% will stay up to a year, 16% up to five years and another 8% will stay more than five years. (A personal note – my grandmother lived in a nursing home for 17 years until she died at age 89.)
What is the cost of Nursing Home care in the St. Louis area?
In 2012 the annual cost for a private patient in a nursing home in the St. Louis area was between $50,000 and $120,000 and up. These costs have been increasing at about 3% per year.
How can an ordinary family afford these costs?
Very few families have the resources that permit them to pay nursing home costs for a disabled spouse and at the same time save a reasonable portion of the family income and assets for the healthy spouse’s living expenses. This is the reason that most families eventually are forced to rely on Medicaid benefits to pay for nursing home care.
What is Medicaid?
Medicaid (MoHealthnet) is a joint state of Missouri and US government financed healthcare program that pays for the medical care for children, adults and the elderly who cannot afford to pay for the medical care that they need. The Medicaid program covers outpatient, hospital and home care as well as nursing home care. As you might suspect, there are income and asset limitations that apply for persons seeking benefits.
Do Medicaid patients in nursing homes receive the same care as patients who pay privately?
They receive the same care. Caring for elderly disabled and incapacitated patients is a difficult task and some nursing homes do it better than others. The St. Louis Long Term Care Ombudsman is a good place to start to investigate placing a spouse or parent in a nursing home.
Can a family get around Medicaid asset limitations by giving assets away or making loans to relatives?
If a Medicaid applicant (or spouse) makes a gift within five years of applying for Medicaid, the applicant will not qualify for Medicaid benefits for a specific time period. This penalty period is based on the value of the gift. There are a small number of exceptions to this rule.
Loans are often gifts in disguise. But if they are real loans with promises to repay in the form of promissory notes, they create planning problems for the Elder Law Attorney and should be carefully discussed with an Elder Law Attorney before they are made.
Does a single person have to spend all of his or her assets before qualifying for Medicaid benefits?
The Medicaid regulations permit a single person qualifying for Medicaid benefits to keep only $999.99 and a $30.00 monthly allowance, his or her home and other assets. But with proper planning an Elder Law Attorney can often set aside a portion of a person’s assets that can pay for needs not provided by Medicaid and provide an inheritance for the person’s loved ones.
Does this mean that the family will get the home after the parent dies?
No. In a process called “Estate Recovery” the state of Missouri will foreclose on the home after the death of a person who has received Medicaid benefits and reimburse itself to the extent of the Medicaid benefits paid for the deceased. This is another reason to talk with an Elder Law Attorney.
Are the regulations different for a married couple?
Yes. The disabled spouse applying for Medicaid benefits is still limited to $999.99 and the $30.00 monthly allowance. But with proper planning the Elder Law Attorney can arrange for the healthy spouse to keep a significant portion of the family’s other assets as well as the home, car and household goods. Then the spouse can use her share of the family assets to provide for herself and the needs of her spouse that are not covered by Medicaid.
Does Medicaid planning with the advice of an Elder Law attorney help a family?
Yes. Under current Medicaid regulations the planning suggested by an Elder Law attorney may save a family thousands of dollars. No family should go through this process without talking to an Elder Law attorney!
Why an “Elder Law” Attorney?
An “Elder Law” attorney focuses on the needs of the elderly. A major part of his or her practice is advising and representing families that have a need for long term care for a parent or spouse.
When should a family consult with an Elder Law Attorney?
Early or late (even after death of the nursing home spouse or parent) it’s a very rare situation when a family doesn’t benefit from a conference with an Elder Law attorney.