Long-Term Care – Planning Ahead
The cost of Long-Term Care has many families concerned about their financial future.
Families often find themselves having to spend all of their life savings to pay for extended care for a loved one; federal and state guidelines even allow the state to take homes to recover Medicaid expenditures.
Medicaid is a joint federal and state program that helps with medical costs for some people with limited income and resources. Medicaid also offers benefits not normally covered by Medicare, like nursing home care and personal care services—but will usually pay a maximum of 100 days of care in a long term care facility. The family then becomes responsible for all expenses.
Medicaid Spend Down
Even if your income exceeds Medicaid income levels in your state, you may be eligible under Medicaid spend down rules. Under the “spend down” process, some states allow you to become eligible for Medicaid as “medically needy,” even if you have too much income to qualify. This process allows you to “spend down,” or subtract, your medical expenses from your income to become eligible for Medicaid. To be eligible as “medically needy,” your measurable resources must be under the resource amount allowed in your state.
Fortunately, there are perfectly legal means to avoid this from happening. In most situations, families can use acceptable alternatives that will protect 60% to 100% of a family’s assets and still qualify for assistance. Even if your loved-one is already in a nursing facility. A good plan may be able to provide homestead and asset protection for loved ones wishing to live at home; or protection of homestead and life savings if inpatient long-term care is needed (60 to 100% protection of assets); or protection of family assets if husband or wife requires inpatient long-term care services (60 to 100% protection of assets). There is also the Ladybird Deed homestead protection to assure that a home remains in family.
Knowledge is Power, so it’s critical for everyone in today’s economy to develop a plan to protect themselves, their loved ones and their assets from the catastrophic consequences of a long term-care illness. Without a plan, the burden of providing emotional, physical or financial assistance falls to the patient’s loved ones. The impact of not planning for long-term care now could be devastating for all.
One of the best things you can do right now for you and your family is get legal, financial and care plans in place. Doing so allows you to participate in making decisions and ensures your family won’t be forced to make them for you in a crisis situation. Planning ahead will help protect family assets while still allowing the patient to qualify for government assistance, by developing a strategy that will get your loved one the care they deserve and not deplete the family life savings along the way.
Although this information has been gathered from sources believed to be reliable, it cannot be guaranteed and the accuracy of the information should be independently verified. This material is intended for informational purposes only and should not be construed or acted upon as individualized tax, legal or investment advice. Neither Lion Street Financial Services, Inc., nor its registered representatives, offer tax or legal advice.