~ Estate Planning ~

Get the Savings & Retirement Benefits You Deserve

There are federal laws that will enable you to avoid paying thousands of dollars out of pocket for nursing home costs. The government will not notify you of your eligibility. You must find out for yourself.

If you are like most people, you have been saving for the future and planning for your retirement, wanting to protect your assets to pass on to your heirs rather than have everything you’ve earned and saved go to a nursing home or care facility. Unfortunately, people sometimes overlook the need to protect against this. For many families, this topic seems overwhelming to discuss or understand.

According to the Boston Globe, 60% of people who reach the age of 65 will spend time in a nursing home. The average stay is 2.5 years and costs over $40,000 per year – and the cost is climbing. There are only three ways to pay for this care:

  • Family Assets
  • Medicaid
  • Long-Term Care Insurance

Few seniors can afford long-term care insurance. Those who can typically will pay these costs until most family assets are depleted and then they will apply for Medicaid. However, with proper planning, you can qualify for benefits before your assets are gone. Since three out of every five people statistically will spend time in a nursing home, planning for the long term is a must.

Eligibility Requirements

Medicaid is an extension of a program created in 1965 by the Social Security Act, Title XIX. It is the primary provider of long-term care benefits for seniors and cannot legally be denied to those who qualify and choose to participate.

However, benefits are not automatic. You must plan in advance in order to get the most benefit possible. Financial and estate planners must not overlook Medicaid planning as part of an overall plan to protect and preserve their clients’ assets. Unfortunately, most planners are not well informed or are misinformed regarding this type of planning. Too much of the following assets can keep you from qualifying for Medicaid benefits:

  • Trusts – Mutual Funds
  • Cash – Savings Accounts
  • CD’s – Bonds
  • Stocks – Real Estate (Other than your home.)
  • Life Insurance (If the face amount is less than $1,500.)

A single person is allowed up to $2,000 in cash (may vary by state), their principal residence, and personal/household property. An at-home spouse is allowed some additional assets, which will vary from state to state and are adjusted annually.

Note: gifting away assets in excess of Medicaid limits prior to application can cause you to be disqualified for benefits.

Some states set monthly income limits, or “income caps,” for the person entering the nursing home. In income-cap states, the income of the healthy spouse is not considered when determining eligibility. If you live in an income-cap state, you will NOT qualify for Medicaid if you exceed your state’s income limits. Consult with an elder law attorney or financial advisor for options in your state.

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