Overcoming the Financial Burden Long-Term Care

Can you afford to pay for long-term care if you need a nursing home or adult day care?

For decades, the stigma surrounding putting a parent in a nursing home drove many families to make great sacrifices in order to keep elderly family members at home in their declining years.

Today, not only has that stigma somewhat lifted, but 4 out of 10 people surveyed believe that they will not need long-term care and/or that the government’s Medicare program will pay for their long-term care if they do. Unfortunately, this mindset may present devastating financial consequences down the line for the majority of Americans.

First, the U.S. Administration on Aging estimates that 70% of those over age 65 will need some form of long-term assistance with their daily activities, so this confidence is misplaced in a significant number of people. Second, Medicare won’t cover long-term care and the eligibility requirements for Medicaid’s long-term care benefits are difficult to meet for many who are neither low-income nor disabled—at least not without proper legal guidance and planning.

Understandably, there is public confusion over the complex differences between Medicare and Medicaid. While both are government-sponsored programs that provide health care benefits, the eligibility requirements and benefits differ. In the simplest comparison on the issue of long-term care benefits, Medicaid does cover long-term care (but only for low-income or disabled individuals), whereas Medicare (which generally benefits people over 65) does not cover long-term care.

The same survey indicated that thirty-six (36%) percent of respondents felt confident and another thirty-six (36%) percent felt somewhat confident that they could pay for long-term care if needed, whereas twenty-four (24%) percent had little or no confidence in their ability to afford long-term care.

Not surprisingly, the groups reporting greater confidence were generally comprised of those in good health, with higher incomes, and advanced education. Notably, this population may be more likely to have larger retirement savings or the ability to afford the often burdensome cost of long-term care insurance premiums. Those with long-term care insurance policies should review them carefully as many have high deductibles and/or limitations that may not cover all long-term care expenses.

With the costs of long-term care estimated at upwards of $92,000 per year for a nursing home resident, it’s easy to see how a comfortable retirement nest egg that took a lifetime to build could be wiped out quickly, leaving people in financial ruin and with nothing to pass on to future generations.

Fortunately, Medicaid eligibility law attorneys can review your particular financial situation and, through strategic divestment planning, may be able to help you qualify for Medicaid so that your long-term care is covered. They know what is required in order to comply with regulations involving look-back periods, income caps, transfer penalties and waiting periods.

The Round Rock, Texas law firm of Gerald Winters, P.C.  has extensive estate planning experience and skill in the complex field of Medicaid eligibility law. Security for your family’s future and peace of mind for your golden years may be only a phone call away. Call 512-270-3807 today for a consultation.

Posted in Elder Law

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