Planning For Assisted Living, Nursing Home Or Long-Term Care
WHY IS LONG-TERM CARE AN IMPORTANT ISSUE?
According to the United States Department of Health and Human Services, someone turning the age of 65 has almost a 70% change of needing some type of long-term care services and support in their remaining years. Between the ages of 40 and 50, eight percent of people have a disability that could require long-term care services. Young people, ages 31 to 64, make up 14 percent of the nursing home population. Generally, women need care longer than men, and of those who need this care, 20% will need it for longer than 5 years. According to a recent Genworth survey, the average costs incurred for long-term care in California are as follows: homemaker Services – $51,480 per year; Assisted Living Facilities – $45,000 per year; Nursing Homes – $89,396 per year. However, in our practice, we have seen individuals paying as much as $30,000 to $40,000 per month, or more, depending upon the level of care required. As you can see, this is one of the most important issues facing all but the very wealthy.
WHO PAYS FOR LONG-TERM CARE?
Medicare will only pay a maximum of 100 days of skilled nursing facility services.
The Medi-Cal program will pay for long-term care in a nursing home, however, it is a needs-based program, and without proper planning, one must spend down their assets in order to qualify for benefits.
Long-term care insurance will pay for long-term care services, however, according to the American Association for Long-Term Care Insurance, only about 8.1 million individuals have such policies.
Most people, especially those who have not planned ahead, simply pay privately for this care, spending down their assets until they are broke enough to qualify for Medi-Cal.
WHAT IS “ASSISTED LIVING?”
Assisted living is a long-term care option for seniors and disabled individuals that provides personal services such as meals, medication management, bathing, dressing and transportation. A recent study showed that approximately 750,000 individuals are now residents of Assisted Living Facilities, and the average length of stay is approximately 3 years.
Generally, neither Medicare nor Medi-Cal pay for assisted living facility care.
WHAT IS NURSING HOME CARE?
A nursing home, convalescent home, or skilled nursing facility provides a type of care for people who require continual nursing care and have significant difficulty coping with the required activities of daily living. Nursing aides and skilled nurses are usually available 24 hours a day.
As noted above, Medicare will provide at most, 100 days of skilled care. Generally, the only other program which pays for such care is Medi-Cal.
WHAT IS THE FIRST THING YOU SHOULD DO TO PLAN FOR THESE POTENTIAL COSTS?
Besides doing your best to stay healthy, when it comes to preparing for the possibility of long-term care, the first thing you should do is make sure you have a comprehensively-drafted estate plan (i.e. living trust, durable power of attorney, etc.), with specially-drafted Medi-Cal asset protection provisions. Why? Because in the event that you need care, there are legal strategies we can use to help you qualify for Medi-Cal benefits for such care, WITHOUT having to spend down to poverty levels, and without losing all or part of your principal residence to the State of California, to pay back any benefits paid on your behalf. However, we can only engage in some of these strategies if you are competent at the time, OR if you have developed a plan in advance with the asset protection provisions addressed above. All of us are one severe medical problem away from incompetency (e.g. a stroke), and once this happens, you can no longer sign the legal documents necessary to protect your assets. Therefore, developing this written plan is essential!
WHICH PROGRAMS ARE AVAILABLE TO HELP ME PAY THESE COSTS OF CARE?
Medicare: As noted above, Medicare only pays a maximum of 100 days of skilled care.
Medi-Cal: It has been our experience that most individuals who require long-term care for over a year, eventually end up having to qualify for the Medi-Cal program to pay for this care. As noted above, with proper planning, one can qualify for Medi-Cal benefits for long-term care, and still take steps to protect their assets. Those individuals and couples who develop their living trust-based estate plans through our office, will have ALL legal options available to them for the protection of their assets, even if they later become unable to participate in the planning process. This is especially important for married couples, and those who have children. Note: For more information on Medi-Cal, please click here to see our Medi-Cal Planning Asset Protection information.
In-Home Supportive Services: According to the California Department of Social Services, The IHSS Program will help pay for services provided to you so that you can remain safely in your own home. To be eligible, you must be over 65 years of age, or disabled, or blind. Disabled children are also potentially eligible for IHSS. IHSS is considered an alternative to out-of-home care, such as nursing homes or board and care facilities.
The types of services which can be authorized through IHSS are housecleaning, meal preparation, laundry, grocery shopping, personal care services (such as bowel and bladder care, bathing, grooming and paramedical services), accompaniment to medical appointments, and protective supervision for the mentally impaired. In order to qualify:
- You must physically reside in the United States.
- You must also be a California resident.
- You must have a Medi-Cal eligibility determination.
- You must live at home or an abode of your own choosing (acute care hospital, long-term care facilities, and licensed community care facilities are not considered “own home”).
- You must submit a completed Health Care Certification form.
Generally, in order to qualify for IHSS, one must be eligible for Medi-Cal benefits, meaning that for an individual, they cannot have over $2,000 in countable assets. (Note: Some assets that are NOT countable assets are a principal residence, a burial plot, and an irrevocable prepaid contract for funeral expenses). If accepted on the program, IHSS will pay a small hourly fee (for example, in 2017, Orange County’s figure is $10.50, and Los Angeles County’s figure is $11.00) to a caregiver to assist you up to approximately 283 hours per month.
VA Benefits (Aid and Attendance): Veterans, and certain spouses of deceased veterans, may be eligible to the VAs Aid and Attendance program, which could provide a monthly income to veterans (or their surviving spouses) to help pay the costs of home care, and even assisted living facility care. Note: For more information on Veterans Benefits, please click here to see Veteran Planning information.
Please be advised that the information on this site is not meant to be construed as legal advice. If you need legal advice, or for more information about planning for long term care and assisted living, please contact our office at (562) 594-4200 for a FREE 30-minute consultation!