The baby boomer generation is reaching retirement age, and as a result, there is an aging of the population underway. A lot of people are asking questions about the legal and financial issues that they may face as they get older. As elder law attorneys, we are ideally positioned to provide guidance.
There is one particular fact of life that you should fully understand when you are looking ahead toward the future. The vast majority of senior citizens will eventually need some type of assistance with their activities of daily living.
Many folks will be able to rely on family members and friends to help them out while they remain at home. This can be possible for a while, but at some point, professional care if often needed.
The U.S. Department of Health and Human Services tells us that 35 percent of seniors will eventually reside in nursing homes.
Since Medicare is designed to provide health insurance for senior citizens, and most elders will need living assistance, you would assume that Medicare would pay for it. A lot of people don’t think it’s fair, but in fact, the program does not cover this type of care.
Nursing Home Costs
It is tough to get out a checkbook and pay for a stay in a nursing home on your own. The typical annual cost for a room in a nursing facility in the Detroit area is right around $100,000, and these expenses have been on the rise. The average length of stay is one year, and married couples have to prepare for two sets of nursing home bills.
The situation is not all gloom and doom, because there is a widely embraced solution. Medicaid is another government health insurance program, and it does cover the custodial care that nursing homes provide. In fact, most people in nursing homes are enrolled in the program.
You are probably aware of the fact that you can’t qualify for Medicaid if you have significant resources in your own name. There is a $2000 limit on countable assets, but there are things that don’t count, including your home.
It is also possible to qualify for a Home and Community-Based Services waiver. This would help pay for a professional home health aide if you can get the assistance that you need in your own place of residence.
Careful Financial Planning
When it comes to assets that you have in your possession that are countable, you can take the right steps to position them wisely with future Medicaid eligibility in mind.
Why does it take careful planning? It’s because of the five-year Medicaid look back period.
You can give your loved ones their inheritances in advance in an effort to qualify. However, the gift giving must be completed at least five years before you submit your application for Medicaid coverage.
If you violate this rule, you are not permanently ineligible, but you would have to wait out a penalty period. Simply put, your eligibility would be delayed by one year if you gave away enough to pay for one year of nursing home care.
Since people usually enter nursing homes toward the end of their lives, there is not a lot of time to wait in most cases.
Access Michigan Elder Care Resources
The website of the Michigan Department of Health & Human Services is the ideal starting point if you want to learn about these benefits. Visit their Services for Seniors page to obtain information.
Schedule a Consultation Today!
We know that this is a tough subject to tackle, but aging is a fact of life. When you do everything you can to prepare yourself in advance, you can find some peace and watch the future unfold.
If you would like to discuss a Medicaid planning strategy with an attorney that really cares, we are here to help. We can gain an understanding of your situation, explain your options, and help you put a custom crafted plan in place if you decide to move forward.