$12,859 PER MONTH! The average cost of nursing home care in PA last fiscal year was $12,869.59 per month, or almost $155,000 per year. If you have to go to a nursing home, would you rather lose it all, or keep some of your hard-earned savings? Would you rather end up with less, or more?
You don’t have to spend it all. If you just let the nursing home staff advise you, they will tell you to spend down almost ALL of your money on a private pay basis till there’s very little left, then get Medicaid. They’re not going to advise you about proactive, affirmative, creative strategic planning to get you what you need but save money for you.
For most of my clients of more ordinary middle-class means – that is, who aren’t rich – and who need nursing home long term care, one of my goals is often to get you eligible for Medicaid benefits to pay for you. (Medicaid pays for nursing home and home nursing care, but not assisted living or personal care home.)
Even though Medicaid financial eligibility rules are stringent, there are still legal, lawful planning strategies and techniques that work, that we can use to save you money and get you a much better bottom line result. Here are some of them.
Medicaid Qualified Spousal Immediate Annuity: if one spouse from a married couple is entering a nursing home but the husband or wife remains at home, with this technique I can help you protect and save almost everything you have, except for only the expenses of putting the plan in place. In court cases contesting this strategy it has been validated repeatedly, and I use it whenever I can to help married clients get a much better bottom line result when nursing home care is needed. Perhaps best of all, it works on a “wait and see” basis, as it is used only later when the need for nursing home time has arrived.
Gift and Medicaid annuity strategy: When a widow or widower or an unmarried, single person is headed to the nursing home for long term care, with this approach I’m able to save about half of whatever financial assets you have left – and that’s a lot better than losing it all! Like the first example, this plan can only be implemented later, when someone needs to go to the nursing home.
Irrevocable Asset Protection Trust: For the right client, this method can conserve assets, avoid probate, preserve capital gain tax advantages, and reduce or sometimes even eliminate PA Inheritance tax – but unlike the first two strategies, it must be implemented in advance, prior to when you need it, sooner rather than later, because you need to wait five years to get the benefit and protection. It’s most useful when there is somewhat more money involved rather than less; when the need for nursing home care is less imminent and more distant; or when someone has long-term care insurance, to buy time for the plan to work. Disadvantage? In addition to giving up control of a chunk of your money and needing to plan ahead, it’s more complex and takes more time, energy and money to put in place.
Exempt Transfers: Medicaid ordinarily prohibits you from giving away gifts in order to safeguard your money. Making such forbidden gifts impairs your eligibility for benefits. Some gift transfers are allowable when done correctly, such as gifts to your husband or wife, your child who is disabled, blind, or under age 21, your qualifying, live-in “Caregiver Child,” a sibling co-owner of your home, or to a proper special needs trust for any disabled person.
Family Care Agreement or Personal Services Contract: Using this tactic you can protect assets by transferring wealth – or sometimes your home – to family or other caregivers, to pay them and get those assets out of your name. The written agreement converts a transfer to a family member that would be presumed by Medicaid to be a disqualifying gift, to compensation in return for services rendered, instead.
Irrevocable Prepaid Funeral and Other Prepaid Bills or Repairs: You can also put resources into allowable transfers, such as depositing funds into a prepaid burial/ funeral trust account at any time; or other purchases prior to becoming Medicaid eligible such as buying or upgrading a car, paying off an existing home equity loan or mortgage, or making needed repairs to your home (though timing is important with these techniques). or prepaying any bills that you can.
Real estate strategies: You may be able to protect and shelter resources under other real estate related strategies such as using financial assets to purchase an exempt, protected home instead of renting, purchasing a new shared home with a family member, paying for a life estate interest in someone else’s home, or installment-sale-and-lease-back.
VA “Aid and Attendance” Benefits: Though the financial limits were tightened several years ago, eligible veterans and their spouses or widows may be still be able to get VA “Aid and Attendance” benefits, especially to help boost your ability to pay for home care or assisted living (more so than for nursing home care).
The crucial point to appreciate is there are many available strategies to protect your hard-earned nest-egg even when you or a family member are on the way to catastrophically expensive long-term care in a nursing home -or even If you’re already there. It’s never too late to try. I’ll help you fight to get what you need and to keep what you can keep.
