By Patrick J. Kelleher, Esq.
Hanover, MA – If you own a home with equity and are 65 years or older, time may be running out to take advantage of a crisis planning option, should you require long term care.
If you or your spouse became incapacitated, how would you pay for the $15,000 per month nursing home? This question is on the minds of folks who attend our educational workshops each month at our learning center in Hanover. People are very concerned about the costs of long term care and the effect it has on themselves, their spouses and their children. An average three year stay in a nursing home at the private pay rate of $15,000 per month will cost the family a staggering $540,000!
Can your family afford to pay over $500,000 to the nursing home? The statistical data says that 70 percent of people 70 years of age and over will need some type of long term care assistance someday, whether it be in an assisted living facility or a nursing home. Many people think this will never happen to them, but it can, and it did happen to my dad. He always believed that he would never end up in a nursing home, but, unfortunately, he did, and he regretted it terribly in his final days. He felt that he let his family down. He spent his entire life working hard to protect the family, but he never took action to protect the family home from the nursing home (you can go to our website at elderlawcare.com to learn more about my dad‘s story).
At our workshops, people always ask, “Patrick, how do we protect our assets?” “We can’t afford the $15,000 per month nursing home!” Typically, there are three ways to pay. First, private pay $15,000 per month out of your pocket. The second option is long term care insurance; however, most folks do not have long term care insurance because of the expense of annual premiums. The third option, and last resort for many people is to apply for and qualify for MassHealth Medicaid benefits.
Applying for long term care benefits from the State is often the most common option. Without substantial wealth, seniors cannot afford to pay privately for a nursing home. For those who apply and can qualify, MassHealth Medicaid will pay the nursing home costs, but any assets that you retain control of such as the family home could be subject to a lien from the State. Would you rather give your house to your children or to the State?
How do you qualify for MassHealth Medicaid? You must qualify both medically and financially. To qualify medically, you must demonstrate that you require the kind of care that can only be provided in a nursing home. To qualify, financially, under current law, the nursing home spouse must have under $2,000 in assets and the community spouse must have less than $123,600 in assets. The family home and car are considered non-countable assets for eligibility purposes; however, MassHealth Medicaid can lien those assets.
Clients with assets above the limit can look to shelter those assets by placing them in a “Pooled Trust.” The Pooled Trust is designed to allow seniors to financially qualify for MassHealth Medicaid while retaining the ability to afford hearing aids, transportation, companion services and other items that are important for quality of life but are not covered by MassHealth Medicaid. Unfortunately, the legislature here in Massachusetts is quickly looking to close the window on the pool trust planning option for folks 65 years of age and older. State officials feel that they can lessen the strain on the state budget by closing the pooled trust option.
What does this mean for you? It is more important than ever to preplan now. Due to the impending law change the crisis planning strategy of the pooled trust will likely not be available in the very near future.
Who would you like to leave your home to? How would that make you feel? How can you learn more? Very simple, take action and call us today at (781) 871-7526 to reserve your seat for our next free educational elder law workshop! Call today, because seating is limited, and we fill up quickly.
About the Author: Patrick J. Kelleher, Esq.
Patrick’s mission in life is to help his clients and their families in a meaningful way with Estate Planning, Elder Law, Veterans and Special Needs Planning! For more information visit his website www.elderlawcare.com or him at (781) 871-7526