by Curry Andrews
Long term care costs are skyrocketing! The Idaho average “out of pocket” base charge for assisted living is $3,475 a month. Nursing home care starts at $7,574 based on Genworth Financial’s 2018 report. And these are only the base costs. Add in dental, vision, hearing aids, medical equipment, prescriptions, physical therapy, and the financial picture starts to get really grim.
There aren’t many families that can afford long term care that amounts to anywhere from $50,000 to $120,000 a year. The solution, more often than not, requires folks to apply for Medicaid benefits to cover the cost of assisted living or nursing home care.
So, if you don’t have a million or two in your accounts, it would be prudent to plan for an eventual application for Medicaid. Here are a few of the trips & traps that you might encounter:
First, when applying for Medicaid, the Department of Health & Welfare is bound by law to look for any “transfers without adequate compensation” that occurred within 60 months of your application. In other words, if you have given away or made a gift of any property or cash over a minimal amount, Medicaid will want that gift returned or will assess a penalty that will delay your ability to qualify for long term care benefits. To summarize: Do Not Give away money or property if you will be applying for Medicaid in the future!
Second, to qualify for Medicaid, the person to be placed in care must have an income under the annual limits (in Idaho that is currently $2,313 per month). Any additional income must be either transferred to the non-institutionalized spouse or directed to a qualified income trust that is sometimes referred to as a “Miller Trust.” To summarize: Get expert help to determine your income eligibility or make adjustments prior to application.
Third, the person to be placed in care is required to have less than $2,000 in “countable assets.” If there is more than $2,000, then that additional property must be spent on approved items or services before application. Also, if the person has a spouse, he or she can keep more than that under the law, but talk to an expert before transferring between spouses. To summarize: Get expert help to determine what can be transferred between spouses and what must be “spent down” to qualify.
Don’t fall into the trips and traps. Planning ahead will assist greatly in reducing cost to your family and the headaches and heartaches that come when mistakes are made prior to application.
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