Many families experience role reversals at some point in time. You may find that your parents need your assistance when they start to reach an advanced age, and the level of help that is needed may slowly increase.
When the demands become significant, you may be incapable of meeting them on your own. This is something that many people experience, and under these circumstances, professional assistance will be needed.
Assisted Living Costs
The first thing to understand about assisted living is the expense factor. Medicare will pay for convalescent care after an injury or illness when recovery is expected. However, it does not pay for the custodial care that nursing homes and assisted living facilities provide.
Home health aides deliver custodial care as well, and many people would prefer to stay in their homes. Unfortunately, Medicare does not cover this type of custodial assistance either.
In the Charlotte area, you are looking at about $90,000 for a year in a private room in a nursing home, and the median annual charge for a one-bedroom unit in an assisted living community is just under $55,000. For a home health aide, the figure is $50,000 a year.
What’s the Solution?
For most people, the solution is Medicaid eligibility. This government health insurance benefit will pay for custodial care, but it is a need-based program so there is an asset limit of $2000.
There are some things that do not count, including a home with an equity limit of $595,000 this year. We will get into the other non-countable assets at a different time, but for the most part, they are not extraordinarily valuable.
Medicaid will pay for residential nursing care, and there is a Medicaid waiver program that covers in-home care for those that can get the care that they need in their homes.
Medicaid Estate Recovery
An applicant could qualify for Medicaid while they are in possession of a home, but the property may be subject to Medicaid estate recovery. The program is required to seek reimbursement from the estates of former beneficiaries so a lien can be placed on residential property at death.
Spending Down and the Five-Year Look Back Period
The logical course of action would be to give gifts to your loved ones while you are still living so you can qualify for Medicaid if you need the coverage. This sounds simple enough, but it is complicated by the five-year look back period.
Most gift giving has to be completed at least five years before you apply for coverage. For this reason, advance planning is key. Elder law attorneys help people develop nursing home asset protection strategies, whether 5 years ahead of time or in emergency situations.
Attend a Free Webinar
We are going to be holding a number of webinars over the coming weeks, and this is a very convenient way to learn about some important estate planning topics. There is no charge to attend the sessions, but we do ask that you register in advance so we can reserve your spot.
You can see the schedule if you head over to our webinar page. When you identify the session that you would like to attend, follow the simple instructions to register.
Schedule a Consultation!
If you would like to implement a nursing home asset protection strategy, there is no time like the present. We can gain an understanding of your situation and help you create a custom crafted plan that is perfect for your family.
You can set the wheels in motion if you give us a call at 704-944-3245 for Charlotte, North Carolina or Huntersville, North Carolina; 606-324-5516 for Ashland, Kentucky; or 859-372-6655 for Florence, Kentucky. If you would rather send us a message, fill out our contact form and we will get back in touch with you promptly.
John’s practice focuses on the use of Wills and Living Trusts in Estate Planning to help individuals protect their families and preserve their legacies after their deaths, but his practice also focuses on the critical issues of protecting individuals with dementia or other diminished capacity, assisting individuals in qualifying for Medicaid and other government benefits to offset the costs of long-term care, and providing special needs planning.
John is admitted to practice law in North Carolina, South Carolina, Kentucky, and Ohio, and he is accredited by the Department of Veterans Affairs.
- What You Need to Know about the Medicaid Look-Back Rule - January 3, 2023
- How to Pass Down Your Legacy in Your Estate Plan - October 3, 2022
- Practical Steps to Take after Receiving a Terminal Diagnosis - September 30, 2022
