Like most people, you probably prefer not to think about the possibility that you will end up in a nursing home someday down the road. While understandable, it is not wise to ignore the possibility. This is one of those situations where “burying your head in the sand” could cost you, and your loved ones, a small fortune. Instead of putting your nest egg at risk, talk to your Missouri elder law attorney about adding a nursing home planning component to your overall estate plan. By doing so, you will be able to protect your nest egg and ensure that your nursing home expenses are covered down the road if you do, indeed, need long-term care.
I Might Not Need Nursing Home Care
No one likes the idea of ending up in a nursing home; however, the reality of life in the 21st century is that the majority of people who live well into their “Golden Years” do, eventually, need long-term care (LTC). At age 65 you will stand a 50 percent chance of eventually needing LTC – and those odds continue to go up. At age 85 you will stand a 75 percent chance of eventually needing LTC. The reason for this is simple. Although we have managed to almost double the life expectancy of the average American over the past century, we cannot stop the natural aging process. The result is that most of us spend more time dealing with a mind and body that has aged. Moreover, adult children are often unable to care for aging parents, as was once the custom. It is not that children do not want to be full-time caregivers for their parents, but the average family is a two income family in the United States in the 21st century. Even when two incomes are not needed, one parent is typically a stay at home parent for young children, making it very hard to also care for an aging parent who may be suffering from dementia. The end result is that nursing home care is often the only realistic alternative.
Why Is Nursing Home Planning Necessary?
If you do need nursing home care, the cost of that care will be high. That, in turn, could put your “nest egg” at risk. How? Because unless you can afford to pay for that care out of pocket you will need to qualify for Medicaid to help cover the cost. At an average yearly cost of about $65,000 a year in Missouri right now, and an average length of stay of 2.5 years, most people cannot pay for LTC out of pocket. Don’t expect your basic health insurance coverage to help unless you purchased a separate long-term care rider at an additional cost. Medicare won’t help either as the program only covers LTC expenses under very limited circumstances, and even then only for a very short period of time. So far, that leaves your hard-earned assets that make up your nest egg as the only option for covering your LTC expenses. Therefore, you need a plan that does not include losing your nest egg.
What Is Included in Nursing Home Planning?
One option for covering nursing home costs is to qualify for Medicaid. In fact, over half of all seniors rely on Medicaid to cover their nursing home expenses. The problem with Medicaid is that there are income and asset limits that apply to all applicants. If the value of your assets exceeds the program limit you will have to sit out a waiting period before Medicaid will start helping. The idea being that you can rely on your assets — your nest egg – during the waiting period. Transferring those assets out of your name at the last minute in an effort to protect them won’t work either because Medicaid employs a five-year “look-back” period. In essence, this means that any asset transfers during the five-year period leading up to your application will likely be ignored and the value of the asset included in your countable resources for purposes of determining eligibility. Nursing home planning, however, as part of a larger estate plan, can protect those assets in anticipation of your need to qualify for benefits down the road.
If you have additional questions or concerns about nursing home planning, contact the experienced Missouri estate planning attorneys at Amen, Gantner & Capriano, Your Estate Matters, LLC by calling (314) 966-8077 to schedule an appointment.