The Simplest Way To Reduce Nursing Home Costs
While Protecting Your Family's Assets
Whether you're looking into Medicaid Planning for yourself or for a loved one, health care is one of the most intricate and constantly changing areas of the law. There are exactly 300 frequently asked questions on the official Medicaid .gov site. That, in and of itself, is an indicator of how convoluted the process can be!
But why is applying for Medicaid so difficult? Simple. Medicaid is a Federal Program administered on a State Level. All of the regulations and rules (such as eligibility) that govern it can vary greatly by state. Even within a state, Medicaid laws and programs may regularly change.
In recent years a number of non-lawyers have started businesses offering Medicaid planning services to seniors. While using one of these services may be cheaper than hiring a lawyer, the overall costs may be far greater. If you use a non-lawyer to do Medicaid planning, the person offering services may not have any legal knowledge or training. Bad advice can lead seniors to purchase products or take actions that won't help them qualify for Medicaid and may actually make it more difficult. The consequences of taking bad advice can include the denial of benefits, a Medicaid penalty period, or tax liability.
As a result of problems that have arisen from non-lawyers offering Medicaid planning services, a few states (Florida, Ohio, New Jersey, and Tennessee) have issued regulations or guidelines providing that Medicaid planning by non-lawyers will be considered the unauthorized practice of law. Applying for Medicaid is a highly technical and complex process. A lawyer knowledgeable about Medicaid Law in the applicant’s state can help applicants navigate this process. An attorney may be able to help your family find significant financial savings or better care for you or your loved one. This may involve the use of trusts, transfers of assets, purchase of annuities or increased income and resource allowances for the healthy spouse.
Do I Really Need a Lawyer
For Medicaid Planning?
You do! And here's why...
Instead of taking steps based on what you've heard from others, doing nothing, or enlisting a non-lawyer referred by a nursing home, you can hire an elder law attorney. Here are a few reasons why you should at least consider this option:
When nursing homes refer the families of residents to non-lawyers to assist in preparing the Medicaid application, the preparer has dual loyalties, both to the facility that provides the referrals and to the client applying for benefits.
To the extent everyone wants the Medicaid application to be successful, there's no conflict of interest. But it's in the nursing home's interest that the resident pay privately for as long as possible before going on Medicaid, while it's in the nursing home resident's interest to protect assets for the resident's care or for the resident's spouse or family.
An attorney hired to assist with Medicaid planning and the application has a duty of loyalty only to the client and will do his or her best to achieve the client's goals.
Nursing homes can cost as much as $15,000 a month in some areas, so it is unusual for legal fees to equal the cost of even one month in the facility. It is not difficult to save this much in long-term care and probate costs. And most attorneys will consult with new clients at little or no cost to determine what might be achieved before the client pays a larger fee.
Professionals who work in any field on a daily basis over many years develop both the depth and breadth of experience and expertise to advise clients on how they might achieve their goals, whether those are maintaining independence and dignity, preserving funds for children and grandchildren, or staying home rather than moving to assisted living or a nursing home.
Less experienced advisers, however well intentioned, can't know what they don't know.
While we should expect that every professional we work with will provide outstanding service and representation, sometimes things don't work out. Fortunately there is a remedy if an attorney makes a mistake because almost all attorneys carry malpractice insurance. This is probably not the case with other advisers in the Medicaid arena.
While it's possible that when you consult with an elder law attorney, the attorney will advise you that in your situation there is not much you can do to preserve assets or achieve Medicaid eligibility more quickly, the consultation will provide peace of mind that you have not missed an important opportunity.
In addition, if obstacles arise during the process, the attorney will be there to work with you to find the optimal solution.
Medicaid rules provide multiple opportunities for nursing home residents to preserve assets for themselves, their spouses and children and grandchildren, especially those with special needs. There are more opportunities for those who plan ahead, but even at the last minute there are almost always still steps available to preserve some assets.
How Likely Are YOU
To Need Long-Term Care?
Planning for retirement and deciding whether to buy long-term care insurance would be a lot easier if you knew your odds of needing long-term care, as well as at what age and for how long. Unfortunately, there's no definite answer. On the other hand, some statistics do provide a bit of guidance.
The odds are that you will not need care until you are at least 80 or 85. If you do need nursing home care, there's a 44% chance it will last less than a year (either because you will return home after a period of rehabilitation or you will not survive more than a year) and only a one-in-four chance that your stay will last three or more years. Of course, if it does, your costs will become prohibitive.
However, since only 40% of seniors spend any time in a nursing home and only a quarter of those stay longer than three years, this means that statistically you have only a 1 in 10 chance of needing more than three years of nursing home care.
Unfortunately, these statistics are somewhat dated and are just statistics. How do any of us know whether we are part of the 60% of seniors who will never enter a nursing home, the 30% who will spend less than three years there, or the 10% who will spend more than three years? We don't.
The most responsible thing to do is to take the necessary steps TODAY to protect yourself and your family’s finances should you require long-term care. Our attorneys can help with this planning, explaining your options and the steps that can be taken now to prevent financial devastation later.
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The Medicaid laws and regulations are complicated and subject to change.
Because private payment rates are higher than Medicaid rates, the nursing home has no incentive to assist clients in protecting assets. The filing of a Medicaid application is comparable to filing an income tax return that will be audited.
Always consult an experienced Elder Law attorney in order to avoid mistakes in Medicaid asset protection planning.
You Can Count On
OVER 60 YEARS OF COMBINED LEGAL EXPERIENCE
At Stepp & Sullivan, P.C., our team is well-versed in a variety of complex legal matters. Whether you need assistance establishing your trust & estate plan, guardianship matters, or litigating a probate issue we can help.
Our founding attorney, Jad Stepp, is a full-time member of the National Association of Elder Law Attorneys, ElderCounsel, and the Texas Guardianship Association. While we are proud to have earned a reputation for excellence, we are most proud to serve individuals and families in their times of need.