This is about the 3 most commonly held beliefs about Money, Aging and Estate Planning.
I see people all the time with these beliefs. They’re in bad situations with money, estate planning and long-term care.
So, what are the beliefs and realities?
The first commonly held belief is:
Medicare pays for Long-term care.
Long-term care is In-home, assisted living and nursing home care.
Answer: Medicare will NOT pay for your long-term care.
If you need to go to an assisted living or nursing home facility, Medicare will Not pay for that.
So, what does Medicare pay for?
If I had to go to hospital for a stay, (usually not a long stay), the hospital would stabilize me and move me to a rehabilitation facility where I’d work on getting better with the help of a physical therapist.
You will hear there are one-hundred days coverage. The first twenty, and the next eighty.
For the first twenty (20) days of that care, Medicare will pay. After that, as long as I’m continually improving, Medicare will pay a partial payment on the next eighty (80) days.
If within that one-hundred days, the doctor decides to send the patient home or to a long-term care facility, then Medicare stops paying. You can file an appeal on that, but those are the rules.
After the one-hundred days or within that time, if Medicare stops paying and you have to go to a long-term care facility, who then pays? You pay out of your pocket.
The sad reality is it’s expensive. Many people cannot afford it. They lose everything they’ve worked for their entire lives to pay for their last few years.
So, who can pay if Medicare has stopped paying?
If you have long-term care insurance, which I highly recommend, then the insurance will come in and pay at that point. Having long-term care insurance can also give you time to work on an estate plan.
If you do not have an estate plan, how can you avoid losing all your money and property to long-term care payments or Medicaid liens?
If you are a veteran, veteran’s benefits can help pay for long-term care.
Planning ahead costs you less. Planning ahead gives you, your spouse and your family peace of mind.
For better peace of mind, estate planning can help because you no longer worry about everything you’ve worked for your entire life. You know you will be taken care of, you have set up the foundational documents to protect your money and property for your future and the future of your children and grandchildren. In your retirement years you don’t want to be stressing over losing it all because of a long-term care situation.
The second commonly held misconception is:
I don’t need a Will, or an estate plan because I’m married, and my spouse will receive everything anyway.
Under the rules of intestate succession which means dying without a Will, which I like to call, The States Will, if you die without a Will, (depending on your state laws, and how long you have been married), your spouse is only going to receive a portion of what you have. It could be fifty percent (50%), or one-third, depending on how many children you have.
To ensure your spouse gets everything, you must have an estate plan.
The third commonly held misconception is:
I have plenty of money. I can pay for long-term care.
If you needed care and wanted to pay for in-home care, there are ways to do that.
1- Long term care insurance.
2- Trust planning can put assets aside to help pay.
Many times, nursing home care can easily cost anywhere between $60,000 to $100,000 or more per year. This will quickly spend down even a large estate.
If you want to prevent that, you must plan ahead.
I have sat down with a spouse who believed she and her husband had enough money, but her husband had been in a nursing home for two years and she was scared she’d lose everything, including her home. They didn’t plan ahead.
My grandfather, Worth McIntyre, worked his entire life to get a small farm house in Lattimore, NC. He was in an assisted living facility for the last fourteen years of his life. It was a great facility, and he enjoyed it, but he lost everything. He did not have an estate plan.
My grandmother on the other side of my family had an estate plan. She was able to protect and keep everything. She left her home and assets to her children.
I hate to see people lose their home and assets because they didn’t plan ahead. I hate that because I know I could have helped.
If you are interested in protecting your home and assets and still be in control of your assets, and leave open long-term care options, call out office, we will be glad to discuss options and help you. Call 704-259-7040 or go to our website mcelderlaw.com and sign up for our free e-newsletter.
Greg McIntyre, JD, MBA
Elder Law Attorney