You spend decades working, saving, and building financial security. The idea is to pass on something meaningful to your loved ones and leave behind a legacy that reflects your life’s efforts.
But one factor threatens to unravel those plans more often than people realize: the cost of long-term care.
This is not a hypothetical risk. As people live longer, the need for care increases. What many don’t anticipate is how quickly that need can turn into a financial crisis.
The good news is that there are legal tools an elder law attorney can use to help. You just need to understand the stakes and take action before a crisis hits.
The Long-Term Care Risk Most People Underestimate
According to the U.S. Department of Health and Human Services, nearly 70% of people turning 65 will require some type of long-term care during their lives.
That care might come in the form of in-home support, assisted living, or a nursing home. No matter the setting, the cost can be substantial.
Genworth’s 2024 survey reports that the national median monthly cost of a private room in a nursing home is over $9,500. Assisted living averages around $4,800 per month, and in-home care with a health aide costs roughly $30 per hour. In New York, the numbers are higher.
Multiply these figures over months or even years, and it becomes clear how quickly long-term care expenses can drain your estate.
Even if you’ve saved carefully, these costs may jeopardize your ability to leave an inheritance or provide for a spouse who remains at home.
Why Medicare Doesn’t Protect You
You might think Medicare will help with these costs. Unfortunately, Medicare only provides limited coverage for skilled nursing care, and only under specific conditions.
After a qualifying hospital stay, Medicare may pay for up to 100 days of rehabilitation in a skilled nursing facility. After day 20, you must pay a daily co-pay, and coverage stops completely after day 100.
Here’s the key point: Medicare does not pay for long-term custodial care. That includes help with bathing, dressing, and eating, which are the most common services people need.
Medicaid Is the Real Safety Net
Unlike Medicare, Medicaid does pay for long-term care, including nursing home stays and some home-based services. But there’s a catch: Medicaid is a means-tested program. To qualify, your income and assets must fall below strict limits.
As of 2025, a single applicant in New York must have no more than $32,396 in countable assets. That number may vary slightly, but it is far below what most people consider a sustainable amount.
Some assets, such as a modest home and a vehicle, may be exempt. However, bank accounts, retirement savings, and other investments are usually counted.
To become eligible, many people end up spending down their savings. Once their assets are gone, Medicaid steps in. But at that point, there may be nothing left to pass on.
How Medicaid Planning Can Protect Your Assets
This is where elder law comes into play. Medicaid planning involves using legal tools to prepare for potential long-term care needs while preserving as much of your estate as possible. One of the most effective strategies involves creating an irrevocable Medicaid trust.
When you transfer assets into a properly structured trust, they no longer count as yours for Medicaid purposes. However, the timing of this transfer matters.
Medicaid has a five-year “look-back” period. Any transfers made during that window could trigger a penalty period, during which you’re ineligible for benefits.
By planning in advance—ideally five years or more before you need care—you can protect your home or other assets from being consumed by nursing home bills.
Here’s a key point: The trust can be drafted to allow you to receive income generated by the assets while keeping the principal out of reach of Medicaid.
Why the Sooner You Start, the Better
Spring often brings a fresh perspective. It’s a natural time to get your affairs in order, especially before the demands of summer take over. If you’ve been putting off estate planning or haven’t factored in long-term care costs, now is the time to revisit your strategy.
Starting early gives you more flexibility. It allows you to make thoughtful choices rather than scrambling during a medical crisis. It also gives your attorney time to structure a plan that complies with state laws while meeting your goals.
Don’t Wait for a Crisis to Act
Long-term care needs rarely arrive with a warning. A fall, diagnosis, or cognitive decline can change everything in a moment. If you wait until that point to act, your options may be limited. Working with a licensed elder law attorney now puts you in control.
They can help you create a plan that addresses both your care needs and your legacy goals. That may include creating a Medicaid trust, updating your power of attorney, and making sure your estate documents reflect your current wishes.
A plan that protects your legacy from long-term care costs isn’t something you’ll regret. Waiting until it’s too late might be.
Attend a Free Webinar!
Attorney S.J. Khalsa hosts Medicaid planning webinars periodically, and we also have an on-demand webinar that you can access at your convenience. To get all the details, visit this page: Manhattan, NY elder law and estate planning webinars.
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