As your parents age, long-term care issues may become increasingly important. It’s not always possible to know when a significant health condition will arise. However, if your elderly parent becomes ill or is injured, they may need nursing home care. Skilled nursing care facilities are expensive, and you will want to do what you can to help your parents protect their assets. Here are 5 simple ways to prevent the nursing home from taking your parents’ money:
1) Plan for Long-Term Care
The first way to prevent the nursing home from taking your parents’ money is to plan for long-term care.
- Your parents, like many people, may not think they will need long-term care. However, after age 65, the likelihood of someone needing skilled nursing care services can go up significantly.
- Planning for long-term care can help you and your parents make decisions about the future and determine the best way to pay for skilled nursing services should they become necessary.
- Set up a time to talk with your parents about long-term care insurance, Medi-Cal (California Medicaid), their estate plan, and their existing assets. This conversation is crucial to finding out about their situation and developing ways to help protect their resources.
2) Medi-Cal Planning
The second way to prevent the nursing home from taking your parents’ money is Medi-Cal planning.
- It can come as a shock to learn that Medicare doesn’t pay for extensive long-term care services. This includes nursing home care.
- If your parents don’t have long-term care insurance, they are either going to have to pay thousands of dollars a month for nursing home care or rely on Medi-Cal.
- Although Medi-Cal covers long-term care services at no cost, the program also has specific rules and requirements. Medi-Cal is also means-tested, meaning recipients can’t have too many valuable resources and still qualify for coverage.
- The Medi-Cal program has certain property exemptions, and it’s crucial to know which ones apply to you.
- It’s also important to know that Medi-Cal may seek reimbursement for Medi-Cal services from a recipient’s probate estate.
- The good news is that there are ways to plan for Medi-Cal eligibility while also helping to safeguard your parent’s assets.
At our firm, we assist our clients with Medi-Cal planning and can help your parents qualify for this essential health care benefit program while protecting their money and other resources. Contact us today to schedule a free consultation.
3) Set up an Irrevocable California Trust
The third way to prevent the nursing home from taking your parents’ money is to establish an irrevocable trust.
- Nursing home care can cost up to 80,000 per year. Without long-term care insurance or ample funds, your parents are probably going to need to rely on Medi-Cal to pay for their long-term care.
- Currently, a qualifying Medi-Cal recipient cannot have more than $2,000 in certain types of assets; the limit for a couple is $3,000. (In July of 2022, the state will raise the Medi-Cal asset for programs serving older adults and people with disabilities to $130,000 for an individual and $65,000 for each additional family member. The Medi-Cal means test will be eliminated by 2024).
- The good news is that with the help of an experienced estate planning attorney, also known as an elder care attorney, your parents can set up an irrevocable California trust that won’t count against their Medi-Cal eligibility.
- Once placed in an irrevocable trust, also known as a Medi-Cal trust or Medicaid trust, your parents’ resources are no longer considered their legal property. Therefore, their irrevocable trust assets cannot be counted against their Medi-Cal eligibility or be pursued to pay their nursing home and medical bills.
- Your parents can set up the trust to benefit their beneficiaries, and when they pass away, the irrevocable trust assets can pass to their beneficiaries without going through probate.
At the Law Office of Alice A. Salvo, we help clients create irrevocable trusts and plan for Medi-Cal. Contact us today to schedule a free consultation.
4) Estate Planning
The fourth way to prevent the nursing home from taking your parents’ money is estate planning.
- If your parents don’t yet have a California estate plan, now is the time for them to have one prepared.
- Your parents’ California estate plan will allow them to determine who will get their property, ways to protect their assets, and how medical and financial decisions will be made if they become incapacitated.
- During estate planning, your parents can also decide if it is best to gift some of their estates early rather than risk having their assets taken for nursing home care expenses.
By working with an experienced California estate planning attorney, your parents can learn how to create a comprehensive estate plan that will help them prevent the nursing home from taking their money.
5) Work with an Experienced Medi-Cal and Estate Planning Attorney
The fifth way to prevent the nursing home from taking your parents’ money is to work with an experienced Medi-Cal and estate planning attorney.
- Planning for nursing home care expenses can be a complicated and confusing process.
- Although there are some steps you may be able to take on your own, there are others that you or your parents may not be aware of or know how to properly complete.
- Everyone’s estate is different, and the best way to determine how you can prevent the nursing home from taking your parents’ money is by working with an experienced California estate planning attorney.
- Your parent’s estate planning attorney can help them evaluate their circumstances and identify the most beneficial solutions for protecting their assets.
At the Law Offices of Alice A. Salvo, we are California Medi-Cal and estate planning attorneys with the experience you need to help you develop ways to prevent the nursing home from taking your parents’ money. Please get in touch with us online or by phone to schedule an appointment today.