nursing home medicaid planning

4 Questions to Answer When Facing a Healthcare Crisis

Most people don’t connect estate planning and healthcare issues. However, as people live longer and face the skyrocketing costs of aging in America, a new aspect of estate planning has emerged. We call it “Life Care Planning.” This type of planning addresses the type of care you may need toward the end of life and how to pay for that care.

It is difficult to face, but statistics tell us that 70% of people who reach the age of 70 will need some sort of long-term care (like a nursing home).

The need for long-term care can arise because of stroke, dementia or any number of serious health problems that develop as people age.

4 Questions Every Family Will Have to Answer When Faced With a Health Crisis for an Aging Loved One

When health problems crop up, you and your family will come face to face with the following questions:

  1. How do we pay for good care?
  2. How do we keep the peace in the family during this extremely stressful time?
  3. How do we protect our loved one’s (or our) life savings if the average cost of a nursing home in Central Illinois is $78,000 a year?
  4. How can we take maximum advantage of the help that is available to pay for good care?

Part of what we do in guiding families through this stressful time of life is to help answer these questions by creating a Good Care Roadmap. Our monthly workshop, “How to Protect Your House and Life Savings from the Nursing Home” is a great way to learn more about this crucial aspect of planning. Our next workshop will be held in our offices on Friday, March 9 at 3 pm. 

We also understand that timing is critical when families are facing serious transition points such as a cancer diagnosis, progressing dementia or a sudden stroke. If you or someone you love is in crisis because of a serious medical issue, we urge you to give our Benefit Coordinators, Melissa Coulter and Melina Carlesi, a call today at 217-726-9200. They guide families through this time of life on a daily basis. It’s all they do everyday!

We regularly hear from families who say they can’t imagine getting through this difficult time without the help of an experienced guide. It is one of our greatest pleasures to relieve stress and help get good care for loved ones who are aging!

Medicaid FAQ

Using a government benefit such as Medicaid is a fairly common way to pay for long-term care. According to AARP, 65% of nursing home residents use Medicaid to pay for their care. Unfortunately, there is a lot of misinformation out there, which makes this very stressful time of life even harder for everyone involved.

Here are 7 common questions about Medicaid that we are frequently asked:

Q1: My loved one needs nursing care and I don’t know how to pay for it. How can an elder law attorney help?

A: An elder law attorney can help you legally set aside savings for the benefit of nursing home residents that would otherwise be economically devastated by the cost of nursing home care. Medicaid planning savings can be used for many things not covered by Medicaid, such as a private room for those with behavioral issues from dementia or companion caregivers to help supplement many overworked nursing homes. Without Medicaid planning, your family will have to get out their own checkbook or debit card to buy you the things you need.

Q2: My mother is already in a nursing home. Isn’t it too late to plan?

A: As long as you (or somebody you know) are writing checks to a nursing home, then it’s not too late. Good planning can gain access to benefits sooner than you thought possible, and in bigger amounts than you thought possible, all while still protecting your house, your savings or property.

Q3: I was told there was noting that could be done except to “spend down” all the money.

A: This piece of wrong information usually comes from nursing home case workers. As nice and knowledgeable as those workers are, they are not experts in the financial planning or legal field. You need an advocate, so you have more options and more resources available to you and your family. Experienced elder law attorneys, such as Edwards Group, help families face these issues every single day. There are other options besides spending down all your assets.

Q4: Will I lose my home?

A: What happens to the house depends on whether a person is single or married. If married, and one spouse goes to the nursing home, the healthy spouse can rest easy because the home is protected.

However, if a single person needs nursing home care, the house is not protected. Although someone can possibly get Medicaid while owning a house, eventually the state will put a lien on the house to recoup the benefits paid.

Q5: How much money can be saved by consulting an elder law attorney?

A: This answer varies from family to family, and also depends on if your loved one is already in a nursing home, but at the very minimum, often 50 to 80% of remaining assets can be saved. The earlier you start planning, the more can be protected.

Q6: Won’t the help of an attorney be too expensive?

A: The average cost of a nursing home in Springfield is around $6500 a month, or about $75,000 per year. Now that’s expensive! The cost of planning varies from family to family, but families often feel it’s the best money they’ve spent in their life. The cost of the elder law attorney will be only a small fraction of the savings or money protected.

Q7: This sounds too good to be true. Is it legal and ethical? Will it really work?

A: Yes, this a legal and ethical approach to paying the outrageous costs of long-term care. Much like tax laws, there are incredibly complex rules and regulations that specifically allow for this type of planning. Much like tax attorneys, elder law attorneys have experienced staff members who are well-versed in the complications of VA and Medicaid benefits, and understand what it takes to get approval. This is all we do every day, all day.

If you need to speak to someone right away about your current situation, feel free to call us at 217-726-9200 or email us at info@EdwardsGroupLLC.com. One of our Client Coordinators will be happy to help you. To continue learning more about long-term care planning, click here to watch a short video from Attorney David Edwards on why you need long-term care planning, or make plans to attend an upcoming workshop, “How to Protect Your House and Life Savings from the Nursing Home.”

What Is a Power of Attorney? Why Might You Need One?

Think of all the decisions you make in a week or a month — how much money you spend, or save, whether you get your car fixed, whether you go to the doctor if you aren’t feeling well. What will happen if you can’t make those decisions for yourself? Someone will have to make them for you.

A power of attorney (POA) helps your family navigate these difficult times. A power of attorney is a legal document that gives someone authority to act on your behalf. By using the power of attorney, someone you trust can help carry out your wishes. This person is called an agent, and the power of attorney legally appoints that trustworthy and responsible person you’ve chosen to have the authority to make financial or medical decisions on your behalf.

Your agent will have access to your money and property, so you want to be sure to choose a person who has your best interests in mind. (Click here for a quick test to see if your helper is likely to be a good one.Your POA agent cannot spend your money on themselves, but they do have the authority to spend your money or even sell your house or other property, if that is best for you.

It is important to always keep in mind that a POA can be easily abused. Before you appoint your POA agent, it is a good idea to know what they can and cannot do for you.

To keep learning more about powers of attorney and choosing good helpers for your plan, check out the following articles on our blog:

Power of Attorney FAQ’s

Dangers of a Do-It-Yourself POA

Why You Need a Healthcare POA

Important Advice on Choosing a Healthcare POA

The Secret Test for Your Named Helper

3 Myths About Choosing a Helper for Your Plan

7 Types of Helpers You Need to Watch Out For

What’s the Difference Between a DNR and a POA?

7 Questions to Ask Before the Age of 70

People are living longer than ever these days, and while that is a good thing, it definitely presents challenges. Regardless of you or your loved one’s stage in life, good planning requires that you ask good questions. And asking good questions can sometimes be uncomfortable, unpleasant or overwhelming. We have come up with 7 questions that need to be asked by the time someone turns 70. If you address these 7 things, it will make aging easier on you and your family.

A little discomfort now can make ALL the difference later. One of the keys to this exercise is not taking an emotional approach. We naturally think of ourselves as 15 years younger than we really are. That means when we turn 70, we actually still feel like we’re 55! That’s a big difference. One way to combat this is to look at the cold, hard facts about aging:

  • People reaching the age of 65 will live, on average, 19.2 more years. That’s 84, if you don’t want to do the math.
  • 36% of people aged 65+ reported some sort of disability in 2012. (That’s 1 out of every 3 people.) Limitations in daily living activities because of chronic conditions will only increase with age.
  • Statistics vary, but it is generally thought that 70-80% of people who reach 65 will need some sort of care during the rest of their life!
  • 1 in 3 older women are widows. And according to the Wall Street Journal, 86% of widows live in poverty. Almost half of women 75+ live alone.
  • And according to David Laibson, who specializes in behavioral finance at Harvard University, about half the 80-year-old population is not in a position to make important financial decisions due to rates of dementia and other kinds of cognitive impairment. This means it’s important to make these decisions sooner rather than later.

So, what are the questions we want you to think about and ask yourself?

  1. Who’s in charge here? Every plan for aging needs a good helper. (Think Power of Attorney, executor or trustee.)
  2. Do you have the correct powers in place? If you have a Power of Attorney, does it have the correct provisions to allow the most flexible planning options as you age?
  3. Is your estate plan up to date? Lives constantly change, which means your estate plan needs to be tweaked to match the circumstances.
  4. What care will be needed… and when? This is a great question, without a concrete answer, but it’s important to be realistic and anticipate the possibilities.
  5. Have you explored ALL the asset protection options? Even before care is needed, there are some important steps that can be taken to help pay for care when it is eventually needed.
  6. Are you maximizing available benefits now? If care is needed now, are you sure that you are accessing all available help, like VA and Medicaid?
  7. The best way to answer Question #6 is by answering Question #7: Have you gotten the advice of an experienced elder law attorney? Experienced elder law attorneys deal with these issues everyday, which means they are always up on the latest laws, benefits and local care options.

One final encouragement from Dave on this topic, “It is far easier to have a plan pre-70 and tweak it here and there as the situation changes, rather than having to make all the big decisions during a crisis or once decision-making impairment has begun.” Addressing all 7 of these questions is something that all of our plans do. If answering these questions feels overwhelming, don’t stress! We guide our clients through the decision-making process everyday. And when the time comes to start implementing the plan, we work as a support for your family, making sure that things go as smoothly as possible. Give us a call at 217-726-9200 if you have questions, or check out one of our upcoming workshops.

Important Advice on Choosing a Healthcare POA

Every estate plan needs a good helper(s). Choosing helpers can be really tough. These people will be responsible for making decisions when you can’t make them for yourself. A power of attorney for healthcare will allow someone to help you make a variety of decisions related to medical issues like treatments, surgeries, end of life decisions, living arrangements, and how to get the best care as you age.

Here are 9 key issues to consider when thinking about who you might choose for your healthcare power of attorney:

 

  1. How old should the person be?

    A power of attorney must be at least 18 years old because minor children are not legally allowed in this role. If you are considering younger adult children or family members, maybe in their 20s, it will depend on that person and their maturity level. Are they old enough or mature enough to handle these tough, and oftentimes weighty, decisions?

  2. Do you have ongoing health issues that family members are aware of?

    If a child has helped you face a chronic health issues for years, they may have a better understanding of the decisions you might face, and a better understanding of the decisions you would make for yourself.

  3. Who goes with you to the doctor?

    The person who most often attends doctor appointments, or takes you to appointments right now, might be a good choice for your healthcare power of attorney.

  4. Do you live near your children or other potential powers of attorney?

    If they live far away, that may make it more difficult for them to make informed and timely decisions on your behalf.

  5. If you are considering your spouse, is he or she facing any of their own health issues or memory issues?

    If so, will they be equipped to focus and be capable of clear thinking when faced with an important decision?

  6. What type of person will make the best medical decisions?

    Do you want someone who is compassionate? Most of us do, but what other traits might be important? Sometimes compassion is not enough. If a person tends to become emotional and overwhelmed in stressful situations, will they be able to make tough decisions in a timely fashion when needed? Sometimes a delayed decision or a lack of a decision can result in a situation you would have wanted to avoid — such as your life being prolonged artificially.

  7. Is the person able to be a peacemaker and consider other’s feelings and concerns in making the decision?

    Whether you choose your spouse, your child or another person as the healthcare POA, others can be included in the decision-making process. If your power of attorney is caring and works well with others, then they are more likely to value the input of others.

  8. Will your healthcare agent be able to do what they think is right, even if others strongly disagree?

    For instance, if your spouse knows exactly what you want done, will they be able to follow through even if your kids disagree? A person who is easily influenced by others may not be the best option as power of attorney.

  9. Can they be a good advocate for you?

    Good medical care often requires the patient or the power of attorney to ask good questions. It’s also helpful for your helper to be proactive in seeking out the proper treatment or course of action. Someone who passively says, “OK” to everything the doctor says may not be what you need.

We help families choose good helpers everyday. This is a difficult decision and one of the most important you’ll ever make. You don’t have to do it alone. We can help guide you through the process of deciding who is best.

While you’ll only do this once in your lifetime (or maybe twice), we’ve helped hundreds of families through this process since our firm started in 2008. We’ve seen A LOT over the years and gained wisdom from the families we’ve helped. Give us a call at 217-726-9200 if you would like guidance in choosing good helpers for your plan. We’re always happy to help!

nursing home medicaid planning

Would You Know How to Stop Elder Abuse?

World Elder Abuse Awareness Day was observed recently, and we shared some helpful information in our email newsletter. (Sign up for our educational newsletter here.) Elder abuse is a complex issue that can encompass physical and emotional abuse, neglect, and exploitation. It’s estimated that 5 million older Americans are victims every year. And while that is far too many, it is estimated that for every 1 case of reported abuse, there are 23 more out there that go unreported!

The focus of World Elder Abuse Awareness Day this year was financial exploitation, which can take many forms. In developed countries like ours, abuse often involves theft, forgery, misuse of property and power of attorney, as well as denying access to funds.

Sadly, we see these things here in the office far too often. That’s why a few years ago we created a series on elder fraud. In this three part series, we explore common scams to watch out for, PLUS seven questions that can stop elder fraud in its tracks. Click on the links below to learn more so you can protect yourself or your loved ones:

It will take a community of loved ones, neighbors, professional advisors, case workers, etc. to continue to fight this shameful trend of taking advantage of seniors. Speaking up and educating people are important steps in the battle.

How Innovative Legal Help Saved the Relationship of Two Sisters

This is the real life story of two sisters, an annuity, nursing home costs, and why Medicaid Planning matters.

Mom did not have a lot, but she owned her home, had a steady retirement income, and had purchased two annuities. Each in the amount of $50,000.

Each daughter was named the beneficiary of “their” annuity and would, therefore, receive the $50,000 from the annuity when Mom passed away.

The older daughter fell on hard times and asked her mother if she could cash-in the $50,000 annuity. Mom agreed and the older daughter received her $50,000 “inheritance.”

The younger daughter, not needing her money, left her annuity in place as Mom had originally intended.

Unfortunately, several years later, Mom had a stroke and had to enter a nursing home. She privately paid for the nursing home costs until nothing was left but the home and the younger daughter’s $50,000 annuity.

But the annuity wasn’t truly the daughter’s. Mom was listed as the owner because she was still alive and would, therefore, have to spend the younger daughter’s inheritance before she could apply for Medicaid.

Of course this was very upsetting to the younger daughter. She was the one who hadn’t requested her money early. She was the one following Mom’s original plan for the money to pass upon her death. And yet, she was the one “being punished” financially by her Mom’s stay in the nursing home.

A Resolution

One of our attorneys sat down with the sisters for several hours listening to their story and devising a plan. In the end, we were able to develop a strategy that would allow an immediate transfer of the house to the daughter (thereby equalizing the daughters’ inheritances) while qualifying Mom for Medicaid several months later.

The mother continued to get the care she needed as she aged, and the daughters got a resolution to a very sticky situation. It was a very satisfying experience for our attorney and the two sisters!

We work with families everyday to find solutions to the challenges of estate planning — complicated family circumstances, business and farm succession planning, paying for a nursing home. It is our greatest pleasure when we can help families figure out legal solutions for complicated problems.

What Should You Do Next?

If you want to learn more about planning for exorbitant nursing home costs, check out the following resources:

  1. Download a copy of our Medicaid FAQ (that ran in a local publication) to learn more about paying for nursing care, qualifying for Medicaid, etc.
  2. Sign up for our Medicaid Planning e-course. This series of emails will teach you the basics about planning for Medicaid and applying for the benefit, plus provide you tangible steps to get started.
  3. Attend a free workshop to learn more about effective planning. At our workshop, How to Protect Your House and Life Savings from the Nursing Home, you’ll learn the five ways to pay for care, how benefits like Medicaid or VA can help get the care you or your loved ones needs, and the three keys to creating a “Good Care Roadmap” to protect your family and life savings. Check for upcoming dates here.
  4. If you need help right away, just give us a call at 217-726-9200. We understand that many cases like these are urgent. Our Benefits Coordinator, Melissa Coulter, will be more than happy to discuss your situation and what immediate actions should be taken.

(Video) When is the best time to contact an attorney about long-term care?

If you already know what an elder law attorney does, then you may be wondering when it’s best to contact them for help.

Anytime there is a transition period or crisis situation, your lawyer can help lay the groundwork for care and help get more benefits to pay for that care. Having a lawyer can help you understand your options if your loved one must move from their home or needs more care in an assisted living or nursing home facility.

Examples of transition times when an elder law attorney can help:

  • If you or your loved one are in the hospital or a rehab facility and may be unable to return home.
  • If you or your loved one are in an assisted living facility but are needing a higher level of care, possibly a skilled nursing facility.
  • If your loved one is unable to stay at home without additional help from family or caregivers to help with Activities of Daily Living.

Learn more in this video from Attorney David Edwards:

If you or a loved one is experiencing a transition where paying for care is a challenge and concern, we urge you to call us at 217-726-9200 and speak with our Benefits Coordinator, Melissa Coulter. She loves helping families find solutions for this very stressful time of life. If you want to learn more about planning for nursing home costs, feel free to attend an upcoming workshop, How to Protect Your House and Life Savings from the Nursing Home.

give your house to your kids

(Video) Beware of What Happens When You Give Your House to Your Kids

When faced with the shocking costs of long-term care or a nursing home, many people have to scramble to figure out a way to pay the enormous fees. Realistically, the $6000+ a month it costs for a nursing home in Central Illinois is a big financial burden for most people. Many are left with Medicaid as the only possible way to get the care they need as they age. In fact, it is estimated that 70% of nursing home residents rely on Medicaid to pay their nursing home bill.

Without planning, the most common way to qualify for Medicaid is to “spend down” most of your assets.

So, in order to try and protect assets (like the family home), some people consider transferring their house or other assets to their kids. This can work for Medicaid, if done at least 5 years ahead of when care is needed, but there are risks involved.

The unintended consequences from this approach can create big problems. Learn more about the risks by downloading our guide, “12 Reasons Not to Give Your Property or Your Money to Your Kids Right Now,” or watch the following video where Attorney David Edwards explains a little more about the risks involved in giving money or property away to your children.

What You Need to Know About Nursing Care and Aging

So, what do nursing homes have to do with estate planning? When most people think about estate planning, they almost exclusively think of a Last Will & Testament, but a Will only works AFTER you pass away. A Will sets out what will happen, who’s in charge, and where your assets will go AFTER your death. Around the office, we refer to this as “death planning” because the plan you make goes into effect after you’re gone.

Because people are living longer, a new aspect of estate planning has emerged over the last decade. And this new type of planning is just as important as the traditional “death planning.” We call this form of planning, “Life Care Planning,”because it addresses the type of care you may need toward the end of your life.

It is difficult to face, but statistics tell us that 70% of people who reach the age of 70 will need some sort of long-term care (like a nursing home). The need for long-term care happens because of stroke, dementia or any number of health problems. When serious health issues crop up, you and your family will come face to face with the following questions:

  • How do we pay for good care?
  • How do we keep peace in the family during this extremely stressful time?
  • How do we protect our loved one’s life savings if the average cost of a nursing home in Central Illinois is $78,000/year?
  • How can we take maximum advantage of the help available to pay for good care?

The Basics of Needing Assistance as You Age

When it comes to needing assistance as you age, there are basically three choices:

  1. Stay at home with help. Many prefer to stay in their own home and hire someone to help with light housekeeping, meal preparation, bathing assistance or the activities of daily living (ADLs). However, in-home medical help can quickly become too expensive for most families.
  2. Move to an assisted living facility. At an assisted living facility, you have your own living space, meals provided in a common dining area, and social activities. In addition, they can help with care needs such as bathing and medication. In order to be in assisted living, one generally needs to be mobile (able to get to the dining room, get in and out of bed, etc.).
  3. Enter nursing home care. Most of us would like to avoid this option, but it is often a reality as medical complications from aging begin to stack up. In addition to meals and social activities, nursing homes provide around-the-clock-care, administer medications, offer rehabilitation (in the form of Physical Therapy or Occupational Therapy), etc.

Every month we offer a workshop on this very topic. At this 1.5 hour workshop titled, How to Protect Your House and Life Savings from the Nursing Home, you’ll learn about protecting your life savings while still having options for care as you age. You’ll discover the 5 ways to pay for nursing or in-home care, plus how VA or Medicaid benefits can help get you the care you need. We’ll also talk about how a “Good Care Roadmap” can guide you through this stressful time of life. Check on upcoming dates for this free workshop.