People think that if you’re headed toward expensive long-term care
such as in a nursing home or assisted living, that there’s nothing
you can do to protect yourself financially, and you’re just going
to lose everything you ever worked and saved for.
That’s absolutely not true! You don’t have to lose all your money
when you go to the nursing home. There’s a lot that an elder law lawyer
can do to help you get the care you need AND save money for you. Nursing
home patients and families get much, much better bottom line results when
they get the right kind of advice
You don’t have to just spend down your money by paying the nursing
home. Here are some other strategies that can help protect and preserve
your wealth for you or your children. (Many of these approaches are oriented
toward getting Medicaid to pay for expensive nursing home care.) It’s
never too late to act, even if you are already in the care facility.
Spousal Immediate Annuity: For a married couple, if one spouse is going to the nursing home and the
other is staying at home, this strategy can help you save virtually
everything you have, except for just the cost of implementing the plan. Though it
seems almost too good to be true, court challenges against this planning
strategy have failed, and this planning avenue remains open for you to pursue.
Gift and Annuity strategy: For a single, unmarried person, such as a widow or widower, this technique
can help you protect about half of your remaining financial resources
– which is better than having to spend it all!
Asset Protection Trust: Under the right circumstances, both financially and the expected timing
of your need for long-term care, this approach provides significant asset
protection along with probate and tax avoidance and administrative efficiency.
Exempt Gift Transfers: Although Medicaid rules generally prohibit making gifts as a way to protect
your assets, certain gift transfers are exempt from the anti-gifting rules
and will not cause problems for Medicaid eligibility. Exempt recipients
or transferees can include: your spouse, a blind or disabled child, a
child under age 21, a prescribed special needs trust, or a trust for the
sole benefit of a blind or disabled person. There are also special rules
for the allowable transfer of your primary residence.
Personal Services Contract or Family Care and Compensation Agreement: This tool allows the transfer of your wealth to family caregivers, to compensate
them when appropriate and to protect assets against the potential cost
of long-term care.
Prepaid Funeral and Other Prepaid Bills or Repairs: You can put money into a prepaid funeral or irrevocable burial trust account;
you can buy a new car or upgrade an old car; you can do needed repairs
to your home or pay off an existing home equity loan or mortgage (though
timing is important with these techniques). You can also prepay other
expenses that would otherwise become due soon after, such as for insurance,
taxes, rent, utilities, etc.
Real estate strategies: Other strategies related to real estate or the primary residence exception
can include buying a home instead of renting, purchasing a life estate
interest in someone else’s home, purchasing a new shared home, or
VA Benefits: May veterans and their spouses or widows may be eligible for VA “Aid
and Attendance” benefits, which can especially help pay for home
care or assisted living.
The important understanding here is that there are many possible ways to
protect assets when you or someone you love are headed toward expensive
long-term care such as in a nursing home or personal care home/assisted
living facility. Don’t walk away from your hard earned money without a fight.