Paying for Nursing Home Care

It is impossible to predict whether a family member will require long term nursing home care but one thing is certain. Medicare will not pay the cost of long term nursing home care.

Alternative methods of paying for nursing home care may involve long term care insurance, paying out of your pocket, or qualifying for Medicaid.

In the event you seek to purchase long term care insurance, it is important you get the following benefits:

1. Home care coverage.

2. An inflation rider.

3. Make sure to obtain at least 3 years of coverage.

If you seek to qualify for Medicaid, you should take the following into consideration:

1. You can only have about $2,000 in assets.

2. Your home doesn’t count in qualifying for Medicaid but Medicaid can place a lien on your home to cover its expenses.

3. If you have a spouse, he or she is entitled to retain up to about $95,000 in assets.

4. The individual in the nursing home has to give up all income except for $60 per month for a personal allowance, the cost of health insurance premiums and an allowance for minor children or his or her spouse.　

5. Under certain circumstances the stay at home spouse is entitled to a share of the nursing home spouse’s income.

6. The state can go after the Medicaid recipients estate upon his or her death.

7. The Medicaid application process is difficult, complicated and time consuming.

In the event that you need assistance with Medicaid planning to help preserve your assets in the event of a future Medicaid application or with an actual Medicaid application, you can e-mail us or call at 800-344-6431

Nursing Home Expenses & Medicaid

America has a healthcare crisis. President Obama is now battling with Congress to deal with long term issues involving healthcare.

An area of healthcare that is very often overlooked deals with what happens to Americans when they can’t care for themselves.

The best way to maintain a senior is to keep them in their home under circumstances that they are comfortable with. Seniors live longer when they can stay in their home. If they need help beyond what relatives and friends can provide, home healthcare aides can assist them. As individuals age, sometimes their needs exceed those what can be provided for them in their home.

The needs of seniors are often met by assisted living facilities and nursing homes. Assisted living facilities are generally speaking private pay living arrangements. Seniors who do not have problematic medical needs and have the financial ability to sometimes choose to live in these facilities. The cost of assisted living facilities can be anywhere from $3,000 to $7,000 per month in the metropolitan New York area.

Seniors who have greater medical needs often go to rehabilitation facilities or nursing homes. Nursing homes can cost anywhere from $8,000 to $15,000 per month depending on the level of service the senior needs. How does a middle class person go to a nursing home without all of his assets utilized to pay for his or her care?

There is a program that under certain circumstances pay for long term rehabilitation and/or nursing home stays. This program is called Medicaid. The rules and circumstances involving Medicaid are complex and detailed. The most important rule for the public to understand is that there is a 5 year look back concerning the transfer of assets.

If you have assets and you wish to protect them for future generations, it is important that you see an attorney that handles estate work. Planning can be done to insure that if you do end up in a nursing home, all of your assets including your home, stocks, bonds, pensions, 401(k) and savings won’t be utilized to pay for long term nursing care. You cannot wait until you are very elderly and sick to use this type of estate planning. It must be done a minimum of 5 years prior to the need for nursing home or rehabilitation care.

Should you have questions, contact the Law Office of Elliot S. Schlissel. We can provide you with further information concerning Medicaid and estate planning. Contact us at 1-800-344-6431 or email us at schlissel.law@att.net.

Picture courtesy of levinperconti.

Long Term Care Hospitals – A Capitalist Solution

During the past quarter of a century there have been over 400 long term care hospitals built in the United States. These hospitals do not provide acute care for specific illnesses. They are, generally speaking, holding facilities for individuals who are too sick for nursing homes but not sick enough for regular hospitals.

Patients often stay for many weeks or months in these facilities. Many of these patients are senior citizens. Long term care hospitals have a much higher rate of bed sores and infections among their patients than regular hospitals. They are also more profitable than regular hospitals. They generally do not do surgery in the long term care facilities or handle medical emergencies. Patients needing these services are transferred to general hospitals. 

A large portion of the bills paid for the treatment at long term care hospitals are paid by Medicare. For profit, long term care hospitals often spend less money on patients and have higher profit margins than regular hospitals.

Inspections in the past 3 years in long term care hospitals have found increasing levels of violations of healthcare standards. Many long term care hospitals do not maintain staff physicians on a 24 hour basis. If you have a friend or loved one in along term care facility, you should monitor their treatment to see to it that they are provided with an appropriate level of medical care.

Should you have any problems regarding a hospital stay or a stay at a long term care facility, feel free to contact the Law Office of Elliot S. Schlissel at 1-800-344-6431 or email us at schlissel.law@att.net.

–Elliot Schlissel, Esq.

Picture courtesy of life123.com.

More Options For Medicaid Planning

On Tuesday, this blog featured an article about what seniors can do to qualify for Medicaid if they forsee the need for nursing home services in the future, but do not yet need to go that route. But what if you or a loved one has already had to enter a nursing home? Now, you are faced with a situation where the senior’s life savings will soon be depleted by nursing home bills that can run as much as $10,000 to $12,000 per month. Is there any way to preserve the person’s assets, or at least a portion thereof?

Attorneys have used various strategies to allow seniors to preserve their savings for their children while still “spending down” their estate legally for the purpose of qualifying for Medicaid. One of those, which is not playing out as the most effective method, is the use of “personal service contracts” in conjunction with a lump-sum up-front payments to caregivers.

A better method is emerging for those who need “crisis planning,” i.e., trying to preserve assets after a senior has already entered a nursing home. This is the use of gifts along with promissory notes.

This method consists of retaining an attorney’s assistance to gift  half of his or her assets to another while simultaneously loaning the other half of the assets (minus the $13,900 [in 2009]) to another with a promissory note for repayment. The promissory note must not last longer than the life expectancy of the lender, it must require that  equal payments are made during the loan period without deferred or balloon payments, the note is not terminated by the death of the lender, and the note must be non-negotiable.

The attorney will assist the client in then applying for Medicaid, receiving a denial indicating that the person is “otherwise eligible” but for the uncompensated transfer of the gift. The applicant can then use the payments on the promissory note to pay the nursing home bills till the Medicaid “penalty amount” is paid, and then reapplying for Medicaid at which time the application should be accepted.

At that time, the person will have at least preserved half of her assets from the “spend down” requirement.

Maximum protection can be afforded to seniors’ assets by starting the Medicaid planning process several years before the expected need for nursing home services, as discussed earlier. But the promissory note/gift method, among others, is still available to seniors even if the time has already come to enter a nursing home.

For help with short term or long term Medicaid planning, e-mail or call us at 800-344-6431.

Picture courtesy of the Ombudsman Program.

When You (Or a Loved One) May be Entering a Nursing Home…

If you, a spouse, or parent  think that you may need the services of a nursing home in the near future, you should know that there are some things you can do to plan for this possibility and help maintain some of the person’s assets.

Nursing homes can be very expensive. Residing on one can deplete $9,000 to $12,000 per month from one’s assets on a monthly basis. You can apply for Medicaid to assist with these bills, but they will only begin paying once the person has completely “spent down” their assets to$13,800 (in 2009) altogether.

There are steps that you can take which would allow you to preserve much of your assets for the next generation while still qualifying for Medicaid if and when nursing home services are needed.

When an individual applies for Medicaid, and the Department of Social Services is looking into whether the application has indeed depleted his or her assets down to almost nothing, they actually look up to five years prior to the application date to see if the person made any transfers to children or others in order to preserve their assets from Medicaid’s required “spend down” to poverty.

Elder law attorneys, such as the experienced lawyers at  The Law Office of Elliot Schlissel, can assist individuals in applying for Medicaid or, for instance, setting up an Irrevocable Trust that may allow a senior to preserve his or her assets from Medicaid’s “spend down” requirement throughout their lives.

We can personalize these trusts depending on each individuals circumstances.

For instance,  if someone has owned their home for a long time, such that the house has increased in value by $250,000 for individuals or $500,000 for married couples, and if the Irrevocable Trust does not appropriately deal with this increased equity in the residence, there can be significant tax liability when the house is sold.

Regardless of whether you need an Elder Law attorney to prepare a Medicaid application or create any other kind of Medicaid plan, you can contact our offices at 800-344-6431 or e-mail us with any questions or to set up a free consultation.

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In 5 Weeks, Married Couples Home Care Medicaid Changes Take Effect

The New York Times reported some major changes in Medicaid laws, which are very relevant to those who are getting closer to a time when they or their spouse may be looking at going into a nursing home.

Our law office helps clients prepare for future Medicaid applications and also helps clients actually apply to Medicaid so I’ve seen how these issues play out. First, as a general background, nursing homes can charge anywhere between $9,000-$12,000 per month for residents. Senior citizens who have to go into nursing homes will have to spend down their entire life savings in order to pay their nursing home bills. Once a person has spent down virtually all of their life savings, then they can qualify for Medicaid and Medicaid will pay for future nursing home bills.

Until now, if both spouses in a couple are alive, Medicaid had a higher amount of income that the healthy spouse could keep, and Medicaid would pay for the nursing home equivalent of home care so that both spouses could continue to live together. New York State was allowing the same income limits that apply to nursing home residents apply to those receiving home health care through Medicaid. That is $2,739 a month in combined income and $109,560 in assets not including a home or car.

The Federal government says that these income and asset exemptions only apply to nursing home residents now and not home health care recipients. Thus, couples must now choose between continuing to live together and keeping less of their income and assets or separating and having one living in a nursing home so that they can keep the higher exemption for income and assets.

If you are seeking home care and you’re still married, Governor Paterson has extended the effective date of this change as it applies to New York residents until March 1st. So call us right away to discuss how these changes may affect you.

Picture courtesy of the New York Times