You may wonder why “elder law” is an area of legal specialization. Why would an older person have different legal concerns than someone that is younger? This is a logical question, and we will endeavor to answer it in this post.
Long-Term Care Expenses
There are certain challenges that can present themselves when people reach advanced ages, and there are legal and financial ramifications. The most pressing elder law concern is the matter of long-term care and the costs that are associated with it.
Most people are not too concerned about medical expenses that they will incur when they are senior citizens because they will qualify for Medicare. This health insurance program will act as a safety net, and you can prepare for the out-of-pocket costs when you are establishing a retirement budget.
In addition to these expenses that are typically going to be manageable, there is a complete void in the coverage that heavily impacts the senior community. Medicare does not pay for a stay in a nursing home, and it does not cover assistance that is provided by a professional home health aide.
If you are among the 35 percent of elders that require nursing home care, you are looking at annual bills that can exceed $170,000 in the Manhattan area. A married couple may be looking at two different sets of nursing home bills, and in-home caregivers are also quite expensive.
Elder law attorneys help clients that are looking for long-term care solutions, and Medicaid eligibility is the key. This jointly administered federal/state government health insurance program for people with limited resources will cover custodial care.
There is a $16,800 limit on countable assets in New York, and this is better than most states, because the limit is typically $2000. Still, $16,800 is not a lot of money when you are talking about your life savings.
There are some assets that do not count, including one motor vehicle, wedding rings, engagement rings and heirloom jewelry, household items, and personal belongings.
Prepaid burial plots are not counted, and an applicant can be approved with unlimited term life insurance, $1500 of whole life insurance, and the same amount of cash saved for final expenses.
Your home is not a countable asset with an equity limit of $955,000 in New York in 2022. However, there is a Medicaid estate recovery phase after the death of a beneficiary. The program can place a lien on a home if it is part of the estate of a deceased benefit recipient.
Establish a Medicaid Trust
A Medicaid asset protection strategy can include the utilization of an irrevocable, income only trust. The nice thing about this type of trust is the fact that you can continue to accept income that is generated by assets that you have conveyed into the trust.
This can give you the ability to fund the trust years before you think that you may actually need professional long-term care. The ongoing income will allow you to make ends meet, but you would not be able to access the principal or corpus.
Why is advance planning necessary? There is a five-year Medicaid look back. You are ineligible for five years after you fund a trust or otherwise divest yourself of assets.
In addition to the full Medicaid coverage, there is a Community Medicaid program in New York. It will pay for in-home care if you can gain eligibility, and at the moment there is no look back period.
However, this no look back period for Community Medicaid is in jeopardy. A look back period of 30 months has been scheduled, and its implementation has been pushed back several times. As it stands today, the implementation date is July 1, 2022, so you still have time to apply before the look back goes into effect.
Schedule a Consultation Today!
We can help you qualify for Medicaid to preserve your legacy for the benefit of your loved ones. If you are ready to get started, you can schedule a consultation at our Manhattan elder care planning office if you call us at 212-973-0100.
There is also a contact form on this site you can use if you would rather send us a message.