Presentation Transcript

1. How to Cover Long-Term Care Cost Presented by: Hehr & Hehr Co. L.P.A Estate and Medicaid Planning Attorneys Independence, Akron, Mayfield, Willoughby, Mentor Ohio 44131 Telephone: (440) 449-3266 Website: www.HHOhiolaw.com
2. How to Cover Long-Term Care CostsProtecting your Family * Providing for your Needs Presented By: Albert G. Hehr III Hehr & Hehr Co., LPA Attorneys and Counselors at Law Member: Ohio State Bar, Wealth Counsel LLC. National Academy of Elderlaw Attorneys
3. AVERAGE ANNUAL COST OF NURSING HOME CARE
4. How to Cover Long-Term Care CostsProtecting your Family * Providing for your Needs Current reports state average daily rate in a nursing home is $192/day - $70,000 year Home care - $17 -$20/hour Adult day care - $55/ day or $20,000/year Assisted Living - $80 - $120/day or $29,200 - $40,500 year
5. How to Cover Long-Term Care CostsProtecting your Family * Providing for your Needs How Do We Pay for Nursing Home Care ? Only five Ways to Pay: Private Pay (“You Pay”) Long-Term Care Insurance Medicare (Limited - 20/80 days ) Veteran’s benefits Medicaid (Federal/State Program)
6. How to Cover Long-Term Care CostsProtecting your Family * Providing for your Needs Current Federal and State fiscal budget issues: Entitlement programs currently consume 44 cents of every tax dollar. By 2030 entitlement programs are expected to consume 75 cents of every tax dollar 78 million baby boomers are just reaching the age of retirement.
7. Distribution of National Spending on Nursing Home Care 2003
8. Importance of Timing in Long-Term Care Planning Percentage of Assets Protected 100 “Advance” Planning 50 “Crisis” Planning 0 60 36 0 Time (in Months) Before Application
9. “To care for him who shall have borne the battle and for his widow and his orphan…” - Abraham Lincoln -
10. Veteran benefits – Eligibility At least 90 days of active military service (generally, 24 months for enlistments after September 7, 1980) At least one day of wartime service (combat service not required) Totally & permanently disabled, or attained age 65 Within income limits to qualify for this benefit
11. Veteran benefits – Eligibility Veterans Health Administration – 3 National programs VA Nursing Homes 70% service-connected disability State Veterans Homes Combined Federal and State financed homes Community Nursing Homes Connected through the local VA medical centers
12. Veteran benefits – Eligibility Veterans Health Administration Ohio VA Nursing Homes 5 year residency requirement Honorable discharge Active Duty requirement during period of war or declared conflict or recipient of special service award
13. How to Cover Long-Term Care CostsProtecting your Family * Providing for your Needs Long-Term Care Insurance TIMING If you wait until you need it, you probably can’t get it at an affordable price, so plan ahead. COVERAGE At least 5 years of benefits. Home-care coverage with Inflation protection.
14. LTC INSURANCE Risks of a claim Homeowners insurance – 1/88 Automobile insurance – 1/47 Health insurance – 1/10 Long term care insurance - 2/5 (seniors) 4/10 for working age people (Society of Actuaries report in 2002) Only 4.5 million LTC policies exist Only 6% of Americans own LTC insurance
15. Medicaid Medicaid is a needs-based program to assist needy and low-income people over 65, blind and/or disabled Joint Federal and State medical assistance program Federal government reimburses state approximately $.58 for each dollar spent. Administered by the Counties
16. Medicaid – Eligibility Single - $1,500 total countable assets Married – Minimum of $22,000 in countable assets to community spouse and $1,500 to institutionalized spouse Married – Maximum of $110,000 in countable assets to community spouse After the splitting the estate property
17. Medicaid – Transfers Proper vs. Improper Transfers Transfer for FMV or within allowed methods Care giver child exemption Transfers for less than FMV Gifts – create a term of ineligibility based upon the state determined private pay rate. Current Private pay rate $5,247 Gifts are aggregated during the lookback period
18. Medicaid Eligibility Medicaid Penalty Period: A period in which a Medicaid Applicant is ineligible for benefits, based upon the value of the uncompensated transfer (i.e., “gift”) during the “Look Back” period and the average “private pay” nursing home cost in Ohio. (This period is potentially UNLIMITED.)
19. Medicaid EligibilitySnapshot planning Couple with $100,000 at date of institutionalization.
20. Medicaid EligibilityCautions Review the Estate Planning Documents POA should Name a guardian Allow for gifting – self serving Not limited to $13,000 Tiers of power holders Revocable Living Trusts Real Estate ownership
21. How to Cover Long-Term Care Costs Presented by: Albert G. Hehr III Estate and Medicaid Planning Attorneys Independence, Akron, Mayfield, Willoughby, Mentor (440) 449-3266