Do you have parents or other relatives who are seniors, age 65 or older, or will you be in the senior demographic soon?
If you do, then you are in good company. So do we.
In fact, here are some telling statistics from the U.S. Census Bureau and the American Bar Association’s Commission on Law and Aging:
Americans 85 and older are the fastest growing demographic group
79 million baby boomers are moving into retirement age themselves.
if you are age 65 and single, then the odds are about 50 percent that you will need long-term care at some point. For married couples, odds are about 75 percent that one spouse will need such care
On average, people require two years of long-term care, but one in five will need it for longer than five years.
Looking at the average costs, it’s little wonder 50% of married couples with one spouse in long-term care are impoverished within one year of admission. For singles, that percentage jumps to 70%
Over 2/3 of Americans have not planned for potential incapacity and do not have a Living Will or other advance health care directive!
The Medicaid (Medi-Cal), program is our country’s largest health and long term care insurer, covering 1 in 6 Americans.
What is Elder Law?
Elder Law is the body of law that addresses the special legal challenges that come with the advances in age and health. It requires a more holistic approach to apply legal principles to specific emotional, logistical and financial needs of seniors and their families.
Many seniors (and those who love them) are concerned with two fundamental threats to their dignity:
Becoming incapacitated, and thereby losing control to the court system over their personal, health care and financial decisions; and
Running out of money due to the catastrophic costs of long-term care.
Fortunately, we can help you, your parents, or other aging relatives minimize these threats, or even avoid them all together, through proper legal and financial planning.
Helping Clients Plan for Incapacity
As the number of birthday candles increase on your birthday cake, so do the odds of becoming incapacitated due to an injury or illness. Whether incapacity strikes suddenly or over time, the consequence is the same.
If you or a loved one lose mental capacity, without properly appointed decision-makers in place, it can create a mess:
family members (including spouses) are greatly limited in what they can do and do not have any automatic or inherent authority to make decisions
To get legal authority to handle their loved one’s affairs, family (including spouses) must go through a long and expensive court process called a Conservatorship.
A Judge will supervise the Conservatorship ongoing so the process is not final and those appointed to make decisions are monitored by the Judge
Court is a public forum with little to no privacy
Your wishes might not be followed either if those appointed by the Judge do not know them or object to them:
If you need long-term care and assistance, do you wish to remain at home or are you open to receiving services elsewhere?
Do you have any personal or spiritual wishes you want followed?
Do you wish to be placed on life support, and if so when can you be removed?
Do you want your organs to be donated?
Have you planned for your memorial in any way? Do you wish to be buried or cremated? Have you already made those arrangements and are they known?
As you can see, this will not only cause great frustration, but also additional costs, hassle, and delay that could have been avoided by executing valid legal directives.
That’s why we help all our clients develop their incapacity planning:
Plan Financial Powers
Plan Medical Powers
Create Living Wills
Implement Emergency Cards to keep important emergency documents accessible when needed
The benefits speak for themselves.
Quicker and less expensive,
easier on your loved ones a
protects your privacy from the public record.
reduces the opportunity for conflict within family or in court as your wishes are clearly stated.
What Are Financial Powers?
A Financial Power of Attorney (also called a general durable power of attorney) is a legal document you sign that allows someone else (called your agent) to manage your finances if you become incapacitated and can no longer make those decisions yourself.
Not all financial powers of attorney are the same! It’s imperative that you work with an attorney who can ensure your power of attorney will provide great protection and flexibility so your agent has the powers necessary to make the best decisions for you in real time.
If a power of attorney is not robust or comprehensive, it may greatly limit your agent’s ability to fully protect you in your time of need, or take advantage of legal strategies that could benefit you financially.
If you permanently lose mental capacity before executing a valid and robust financial power of attorney, your family members cannot handle your finances for you without going through a court process known as a Conservatorship. This will not only cause great frustration, but also additional costs, hassle, and delay that could have been avoided by executing a valid financial power of attorney.
What Are Medical Directives?
Medical Directives usually address three key wishes:
who you want to make your medical decisions,
what your end of life wishes are, and
who can receive information about your condition if you cannot communicate.
An Advanced Health Care Directive (also called a health care power of attorney) is a legal document you sign that designates someone you trust to make medical decisions for you if you lack the mental capacity to make these decisions for yourself.
A Living Will declares your wishes for your end of life care and specifies whether you wish to be removed from artificial life support if your doctors determine you will never recover from your injury or illness.
A HIPAA Authorization specifies who can speak with your doctors or the hospital and receive information about your condition if you cannot temporarily or permanently communicate.
Not all medical directives are the same! It is important that your medical directives provide great protection and flexibility so you can receive the care and treatments you need at all times.
Ready to start planning? We would love to hear from you.
Helping Clients Plan for Long-Term Care
Given the high costs associated with long-term care, many seniors that have not planned well will decimate their savings and then need to rely on financially on family to help cover costs or receive the level of care they would like. Long-term Care Costs are Expensive!
Looking at the average costs, it’s little wonder 50% of married couples with one spouse in long-term care are impoverished within one year of admission. For singles, that percentage jumps to 70%.
Here’s a breakdown of average costs across California in 2017 according to the California Partnership for Long-term Care:
Nursing homes: $290 a day or $110,00 annually
Assisted living: $4,050 per month up to $5,200 per month with Alzheimer’s residential care (Memory Care) or $62.400 annually
Home care: $23.50 per hour, with high-end being as much as $35.50 per hour.
Adult day care: $79 per day
Medicare Is Not a Long-Term Care Solution
We often hear seniors say, “I have Medicare, so I don’t have to worry about long-term care.” That is wrong.
Medicare only pays for acute nursing home care, not chronic care. Think of acute care as rehabilitation after hip surgery. You will be going home to care for your own daily needs. Think of chronic care as needing help with “activities of daily living” like bathing, eating, dressing, continence, toileting or transferring, not to mention dementia or Alzheimer’s.
Even for acute care in a skilled nursing home, Medicare is limited to paying for up to 100 days with strict eligibility requirements and full payments limited to the first 20 days and co-payments thereafter. In addition, your Medigap (i.e., Medicare Supplement) policy will not pay for your long-term care, but may pay the Medicare co-payments for days 21 through 100.
Remember, Medicare is DIFFERENT from Medicaid.
They are completely different programs:
Medicare is solely a federal program. It is available for all seniors 65 and older to pay for acute medical needs – it does not cover long-term care (i.e. chronic care)
Medi-Cal is California’s medicaid system designed to help seniors and disabled dependents pay for long-term care costs
Medi-Cal has strict asset and income restrictions, but it’s not just for those with no money or little assets. With proper and ethical legal planning, you do not have to decimate all your assets and savings to qualify. Whether you have assets ranging from $100,000 to $1 million, we can help you reallocate your estate in the proper legal vehicles to ensure its safety and your eligibility for Medi-Cal assistance.
Let us shed some light on some misconstrued notions you may have heard “out on the street.”
You do NOT have to give all your assets away or become broke qualify.
Not all assets are countable and you just need to properly reallocate others.
You DO NOT need to be a low-income earner. Medi-Cal can pay for the cost of long-term care your income can’t cover. There are exceptions as to what counts as income and California is “share of cost” state.
Medi-Cal is NOT just for nursing homes! It can be used for in-home care and even assisted living in some limited circumstances
There is NOT a 5 year lookback in California – it’s only 30 months
You DO NOT need to wait 30 months to qualify for Medi-Cal. You can qualify quicker than that – instantly in some cases.
You DO NOT need give up complete control of your assets to qualify for Medi-Cal- There are asset protection trusts that permit you to keep 100% control of your assets without the risk of losing them if long-term care is needed
Medi-Cal CAN recoup its costs of care from your home (called estate recovery), but NOT if it is placed in a trust – it CAN be any type of trust – revocable or irrevocable
Transferring your home to an asset protection trust DOES NOT trigger a Prop. 13 property tax reassessment and you do not lose a basis step up upon your death
Transferring your home to your children IS NOT a truly inexpensive way to qualify for Medi-Cal or protect your home from estate recovery because it can immediately make you ineligible for Medi-Cal, trigger a gift tax, you will lose a basis step up, and could result in your child’s spouse inheriting the home or being ousted from your own home if they have any creditor issues and need to sell the home.
Medi-Cal Planning Made Easy
Many aging seniors may be eligible for Medi-Cal or VA Pension, including Aid and Attendance Benefit. These benefits can provide your love ones additional financial resources to help fund the cost of in-home care or long-term care assistance.
Medi-Cal is a benefit through California’s Medicaid health care program that helps seniors fund their long-term care needs. (It is different from Medicare because Medicare is an entitlement program for those that have paid into the system). Medi-Cal is a program you must qualify for to receive benefits, and which requires seniors to have very few financial resources in their name.
Fortunately, our planning strategies can help your loved ones preserve their assets but still qualify for Medi-Cal. And because your loved ones still have assets, we can use those assets to help supplement the high cost of long-term care to cover what Medi-Cal will not.
Now is the time to use our strategies to qualify your loved one for Medi-Cal.
California has adopted the DRA (Deficit Reduction Act of 2006) but has not yet implemented it. When it does, it will become much more difficult to obtain Medi-Cal while preserving family assets, leaving your loved one at great risk!
Our long-term care planning attorney will work closely with you (and your family members if you wish) to develop a customized plan to address the very real possibility of incapacity and the need for long-term care. This plan can protect your savings for your benefit, the benefit of your well-spouse, and that of other loved ones.
Your plan can also help you qualify for Medi-Cal assistance as quickly as possible.
Ready to start planning? We would love to hear from you.
VA Pension Planning Made Easy
Another benefit that may be available to your loved ones is the VA Pension and/or Aid and Attendance Benefit. This is a federal benefit available to seniors who served our country during a war-time period OR to the veteran’s surviving spouse.
To qualify, the Veteran (or surviving spouse) needs to meet this main criteria:
Time of services
Limited assets or financial resources in his or her name
[For surviving spouses] Legally married at the time the veteran died – you do not need to have been married to the veteran during their military service.
The time of service must be at least three months in the armed services during which time there was one active day of combat (even if the Veteran did not physically see combat). The VA has the identified the time periods as here: https://www.benefits.va.gov/pension/wartimeperiod.asp
Mexican Border Period (May 9, 1916 – April 5, 1917 for Veterans who served in Mexico, on its borders, or adjacent waters)
World War I (April 6, 1917 – November 11, 1918)
World War II (December 7, 1941 – December 31, 1946)
Korean conflict (June 27, 1950 – January 31, 1955)
Vietnam era (February 28, 1961 – May 7, 1975 for Veterans who served in the Republic of Vietnam during that period; otherwise August 5, 1964 – May 7, 1975)
Gulf War (August 2, 1990 – through a future date to be set by law or Presidential Proclamation)
The Veteran (or surviving spouse) also needs to require daily assistance with activities and only have limited resources or assets in his or her name.
Like with Medi-Cal planning, we can help Veterans (or the surviving spouse) secure the VA Aid and Attendance Benefit without having to first go broke! Now is the time through to secure this important benefit
Crisis Planning Made Easy
A “Medi-Cal Crisis” is a situation where an individual has already been admitted to a nursing home, or must enter one in the very near future, and been informed that she or he owns too many assets to be eligible for Medicaid assistance. It is considered a crisis because the high cost of nursing home care often depletes a family’s entire life savings within a matter of a year or two.
If you have been told that you have too many assets to qualify for Medi-Cal assistance to pay for nursing home care, you must understand that some of the information provided “on the street” is quite often incorrect.
Even social workers and nursing home personnel may be mistaken about your eligibility for Medi-Cal. Our Medi-Cal crisis attorneys understand the complex laws governing Medi-Cal eligibility and can use a range of strategies and tools to help you qualify for assistance.
Contact our office as soon as possible if you or a loved one is faced with a Medi-Cal crisis. Even if you are already in a nursing home, or have been denied assistance in the past, we may still be able to help.
What about Long-Term Care Insurance?
If you are in good health and can pay the premiums, long-term care insurance (LTC or LTCI) is another means to pay for your care. In addition, long-term care insurance is sometimes used in conjunction with Medicaid legal planning to pay for care during any period of potential ineligibility.
You may not be willing to admit that you may become incapacitated and perhaps need expensive long-term care in the future. However, denial is not a strategy and there is no time like the present to plan.
A debilitating illness or injury could strike any of us at any time. When you are ready to explore your options, contact us!
Want to work together? We would love to hear from you.