But in cases where an insurance company simply fails, every state has an insurance guaranty association that protects consumers. The purpose of this association is to take over the policies of an insurance company that’s experiencing financial difficulties and ensure that claims are paid. [Read more…]
Some residents of assisted living facilities who are covered by Medicaid are at risk of being evicted if they leave the facility for a period of time – even if they leave merely for a temporary hospitalization.
This is a significant problem that seniors should be aware of when they are planning for long-term care.
In general, Medicaid will pay nursing homes to hold a room for a Medicaid recipient who is temporarily absent due to a hospitalization. This entitles the resident to return to the first-available room.
However, most states don’t make similar “room-hold” payments to assisted living facilities. And there is no law requiring assisted living facilities to give priority to returning residents.
As a result, even if an assisted living resident leaves for only a short hospital stay, the facility could refuse to accept the resident once he or she is ready to return. The resident might end up having to find a nursing home instead.
Although the federal government has authorized state Medicaid programs to make “room-hold” payments to assisted living facilities, only a handful of states (including Georgia, Illinois, Montana, and Washington) have adopted such programs so far.
Should you have any questions about your Medicaid planning to avoid eviction, contact Attorney Kristina Vickstrom at 508-757-3800.
[photo credit: MyFutureDotCom]
Often, the best way to handle the problem of long-term health care costs is to buy long-term care insurance. If you can afford the premiums and you’re insurable, this can save you a lot of money in the long run.
However, long-term care insurance can be expensive. If you’re thinking about purchasing a policy, here are some things to consider:
A good way to get started, and to avoid overpaying, is to calculate how much of a benefit you actually require.
For instance, the national average cost of a private room in a nursing home is about $250 a day, and the average monthly base rate in an assisted living facility is $3,550, according to MetLife’s 2012 survey of long-term care costs. These numbers can vary widely from location to location.
One easy way to calculate a daily benefit is to take the average cost of care where you live (or are likely to live when you’ll need care), and subtract from that your daily income. For instance, if nursing homes cost $300 a day in your area, and your income is $3,000 a month, or $100 a day, then your daily benefit should be about $200.
In general, the shortest period of coverage available is two years, but policies can be purchased for much longer periods or even for your lifetime. Of course, the longer the policy’s coverage period, the higher the premiums will be.
Most people don’t actually need lifetime coverage. Often, a good length of time is five years, because statistically it’s unusual for someone to need care for more than five years. In addition, Medicaid looks back five years for any asset transfers. If you purchase five years of long-term care coverage, you could transfer most or all of your assets to your children or to a trust, pay for your care with insurance over five years, and then qualify for Medicaid coverage.
A policy that pays $200 a day for five years might still be expensive, especially if it includes an inflation rider. If you can’t afford such coverage, you could think of long-term care insurance as “avoid nursing home” insurance. Under this approach, you could purchase just enough insurance to pay for home care or assisted living care, which are usually not fully covered by Medicaid.
For example, if you purchased insurance with a daily benefit of $100, you would have about $6,000 a month to cover your living expenses plus home care or assisted living costs. The premium for such a policy would likely be much more affordable than one for a policy with a daily benefit of $200.
Long-term care insurance premiums rise as you age, so the younger you buy, the cheaper your premiums. Be careful, however, because insurance premiums can, and often do, increase considerably from your initial purchase price. Even if you have a policy that is “guaranteed renewable,” your premiums could still increase.
Often, a married couple will be able to afford coverage for only one spouse. This can be a reasonable option, particularly because the Medicaid rules provide some protection for the spouse of a nursing home resident.
If you have no specific reason to think that one spouse is more likely to require long-term care than the other, then looking at statistics alone, the wife should probably purchase the policy. In our society, women tend to live longer than men, and are much more likely to end up in a nursing home for a long period of time.
Of course, this amounts to playing the odds and is not a sure thing. On the other hand, some companies offer incentives for both spouses to purchase coverage, such as a premium discount for the second spouse.
If both you and your spouse are purchasing long-term care insurance, a “shared care” policy might give you more coverage for less money.
With this kind of policy, you buy a pool of benefits that you can split between you and your spouse. For example, if you buy a five-year policy, you will have a total of 10 years between you and your spouse. If your spouse uses two years of the policy, you will still have eight years.
A shared care policy may cost more than separate policies with the same benefit period, but it will allow you to buy a shorter policy knowing that you will have a shared pool of benefits to work with.
Most policies have a waiting period before coverage begins, typically 30 to 90 days. The longer you make this waiting period (which policies typically refer to as an “elimination period”), the cheaper your premiums. Keep in mind, however, that you will have to pay for your care out-of-pocket until the waiting period is over and the insurance begins its coverage.
Inflation protection increases the value of your benefit to keep up with inflation, and is generally recommended. But you should give some thought to whether you want compound-interest increases or simple-interest increases. If you’re purchasing a long-term policy and you’re age 62 or younger, then you’ll most likely want compound inflation protection. But if you’re 63 or older, some experts believe that simple inflation increases may be enough, and you’ll save considerably on premium costs.
To learn more about your long-term care insurance options, contact Attorney Kristina Vickstrom at 508-757-3800 or schedule a consultation online.
You may have a vision for your retirement plan, but does your spouse share that vision?
A recent study by Fidelity Investments shows that many couples are not in accord about their retirement plan. For example, one-third of couples approaching retirement disagree about or don’t know where they are going to live after they retire, and 62 percent don’t agree on their expected retirement ages.
Here are some important things to discuss with your spouse as you get ready retire and develop a retirement plan:
1. When to stop working. Many factors go into a decision about when to retire, including job enjoyment and financial needs. But you’ll also want to include in your retirement plan how to maximize your Social Security benefits. There are a number of different strategies for when each spouse should file for various types of benefits, and couples who do it wrong can leave a lot of money on the table.
2. Finances. Both spouses need to understand their financial situation to develop a retirement plan. The survey found that very often, one spouse is much less involved in planning retirement finances than the other, and might not be ready to manage financial affairs should the need arise.
3. Lifestyle. Do you want to travel? Volunteer? Or relax on a beach somewhere? It’s important to have a conversation about your hopes and dreams for retirement. You can start by creating individual wish lists and then comparing them when developing your retirement plan.
4. Health care. Make sure you and your spouse have adequate health care coverage, either from Medicare or an employer-based plan. You’ll also need to understand the rules regarding Medicare coverage and when to sign up for it.
5. Long-term care. Unfortunately, one or both spouses will likely need some type of long-term care at some point. There are things you can do to make it easier on yourself if the need arises. Talk to your elder law attorney about putting a plan together – doing it early will save lots of headaches and expense later.
Hopefully your respective visions for your post-career life are similar. When you’ve taken these steps, it’s now time to put your dream plans in motion. To ensure that your long-term care plans for retirement are met, it’s vital that you speak with a qualified elder law and estate planning attorney so your wishes are always met.
Contact us when you are ready to make your retirement plan a reality.
We’re not only voting for the next President and a Senator from Massachusetts in November, but on a battery of ballot questions. Ballot Question 2 is one of the more controversial. The so-called “Death with Dignity” or “Right to Die” legislation would allow an adult resident who is (1) capable of making and communicating health care decisions, (2) diagnosed with an incurable and irreversible disease that will cause death within six months, and (3) voluntarily, and in an informed manner, so decides to obtain a prescription for medication to end his or her life. You can read the proposed legislation here.
Oregon and Washington state already have similar legislation in place. In Oregon, most candidates are well educated cancer sufferers over the age of 65, who died at home and were enrolled in hospice care. This “typical candidate” is familiar to many of us working with elders. Maybe it is because so many of us know or have known someone like this that the “Right to Die” issue has strong voices on either side. [Read more…]
As the number of family members providing care for aging parents increases, the solutions to find help with loss of income because of time off from employment for caregiving has become a major concern for many. The demands on both the time and energy needed to provide the needed care can make it impossible to maintain both a full time job with full time caregiving. [Read more…]
Medicaid, or MassHealth as it is referred to in Massachusetts, is an avenue available for funding long-term nursing home care. To qualify, you must meet asset thresholds that many elders exceed. Additionally there are income requirements for MassHealth/Mediciad. Adequate understanding of MassHealth/Medicaid law and proper strategizing is a critical component of any plan for the future. With the proper planning of an elder-law attorney, you can protect your property, spouse, and assets. [Read more…]
A three-day hospitalization often serves as a gateway for a senior citizen’s transition into a skilled care facility. When the patient is discharged to a skilled care facility for occupational, physical, or speech therapy, the patient’s health insurance (Medicare) will continue to finance treatment for up to 100 days per stay (as long as the person continues to benefit from rehab). Medicare coverage ultimately ends, and when it does, the patient must pay from income, savings, long-term care insurance, Medicaid, or a combination of these resources. [Read more…]
