Financing long-term Care for Older Adults: The Myths, The Facts and Planning Strategies - PowerPoint Presentation

1. Financing long-term Care for Older Adults: The Myths, The Facts and Planning Strategies Christina Lesher- attorneyPrivate Practicewww.lawlesher.com 713-529-5900Facebook:Law Office of Christina Lesher pCTwitter:@LesherelderLaw

2. Today’s presentationEstate planning and disability planning documentsMedicaid MythsHow to pay for long-term care expenses

3. Checklist of Documents For Illness/ Incapacity & Medical Decisions1. Durable Power of Attorney/ financial power of attorney/ business power of attorney: Appoints an agent to handle business/ financial affairs- effective now or @ incapacity- provide a copy of POA to each financial institution 2. Medical Power of Attorney- Appoints an agent to make health care decisions- effective @ incapacity3. Directive to Physicians- Allows you to put in writing your desires for end-of-life treatment-effective @ incapacity4. HIPAA Release- Allows you to appoint agents who can access your medical information- effective now5. Do Not Resuscitate- allows a person or family member to elect to not be resuscitated (CPR, advanced airway management, defibrillation, artificial ventilations and cardiac pacing.

4. Documents that distribute your assets at deathA Will appoints an executor and distributes your assets to family/friends/ charity at death.Probate transfers title and ownership of certain types of assets at your death.A Trust appoints a Trustee to handle assets for incapacity and distribute trust assets at death.Out of state property, easier for your beneficiaries, more privateBeneficiary designations trump the will and must be reviewed carefully- especially for long-term care planningAppointment of agent for designation of remains- funeral/burialPersonal Items- give away now or letter of instructionSpecial or Supplemental Needs Trust provides for asset management and eligibility for public benefits. Planning for Minor or Disabled ChildrenPlanning for a Disabled Spouse

5. Estate planning maintenanceIf I have out of state documents I need to________________.If I spend significant time in another state I need to_________________.I need to review my estate plan every ___________ years.I need to review the following:Agent_________________Distribution plan_____________ (including a careful review of your beneficiary designations)Life changes_______________

6. Medicaid Myths You have to be impoverished to qualify for MedicaidYou should transfer your house to your childrenYou should transfer money/assets to your childrenYou should have done something 5 years agoThe Miller trust will help you preserve assets

7. Who pays for long-term care?Limited Medicare CoverageVeteran’s Benefits1-800-827-1000 (then press 1 then press 0) Nursing homes for VeteransAid and attendant benefits (cash benefit for Veteran and surviving spouse)Va.govSee Local Field Office- enroll in health care Long Term Care InsurancePrivate PayMedicaid- usually limited to nursing home settings or at home under Star Plus Waiver

8. Quick Lesson on Medicareand MedicaidMedicare- at 65 or disabled for 2 yearsFederally AdministeredEntitlement80/20 insuranceMost programs not “Means Tested”Part A- Hospital InsurancePart B- Medical InsuranceMedicaid- “needs based”Medicaid mythsUses State & Federal FundsState Administered109 different Medicaid programs in TexasMeans Tested- income, asset testMedical/ Disability testSpousal Protections- special rules for married coupleSpecial rules for families with children under the age of 21 or family members with disabilities

9. What does Medicaid pay for?Caregivers for home careNursing home costsAssisted Living (sometimes)DeductiblesMedical and Support needsPrescriptions* (Medicare Part D)Does not cover:Bed hold chargesSome miscellaneous medical supplies

10. Medicaid requirementsIncome test- depends on the programAsset testCountableExemptMedical testLocation requirementGifts or transfers- 5 year look back period, Medicaid will reduce benefits if you give away assets, transfer assets, or pay for items for another personPenalty starts at application of benefits, and meet all qualifications except for the transfer

11. Exempt and Countable AssetsExemptYour house ($595,000 unless there is a community spouse or minor or disabled child at home)One carYour wedding setRetirement Accounts (usually if over 70 ½)Term life insurancePre-need funeral contractCountableChecking & Savings AccountsAnnuities (unless meets certain requirements)Second Car, Second Home Cash Value of Life Insurance Policies

12. Resources for married couplesDepends on the amount of countable resources they had as of the first month of stay in the medical institutionAll assets of both spouse must be disclosedDepends on the income* of the Community and Institutionalized SpouseMany couples will spend down their assets needlessly There are many techniques such as:Apply for Star Plus Waiver first- can protect more countable assetsGifting (must do with advice from attorney),Administrative appeal, Purchase of annuity,Purchase exempt assets,Special Needs Trust

13. Resources for single people$2,000 in countable resourcesHomestead is exempt up to $595,000 in equity- unless minor or disabled child (but estate recovery applies)Planning strategies exist-Gifts to disabled childrenGifts to disabled individualsGifts to kids under age 21 into educational account (TUTMA)Tx Uniform Transfer to Minors Act

14. Star Plus Waiver- home benefitsProvides 30-50 hours a week of care at home, pays for medical costs Medicare and supplemental insurance doesn’t coverSpouses get to keep more countable assetsPre- qualify medically and financially for NH Medicaid Interest List- call 2112021 Income requirementSingle $2,382 Gross monthlyCouple $4,764 Gross monthlyCan “fix” with Miller TrustResource requirementsMarried couples w/ less than $4,500 (usually) of income (SS/Pension) usually get to keep all countable assetsSome resources count Countable= fair market valueSome resources are exempt $0 valueMedical NecessityCare provided by a trained professional, nurse supervisorNot include inability to perform activities of daily living

15. Nursing home benefitsPre- qualify medically and financially for NH Medicaid using Star Plus WaiverMust be in a Medicaid nursing home, and in a Medicaid bedIncome requirementSingle $2,382.00 Gross monthlyCouple $4,764.00 Gross monthlyCan “fix” with Miller TrustResource requirementsMarried couples w/ less than $4,500 of income (SS/Pension) usually get to keep all countable assetsSome resources count Countable= fair market valueSome resources are exempt $0 valueMedical NecessityCare provided by a trained professional, nurse supervisorNot include inability to perform activities of daily living

16. Medicaid estate recovery Usually applies to a home- can avoid with lady bird deedOnly applies if there not an exemptionE.g. surviving spouseDisabled childValue of the estate is less than $10,000Amount owed to Medicaid is less than $3,000Cost of selling the property is more than the property is worthUnmarried adult child living in the home full time one in the Medicaid applicant’s home one year before the person died.Only applies to probate assets

17. VA benefits for long-term careExample: amount for veteran w/o dependentVA is a cash benefit for a veteran or surviving spouse of a veteranSee VA.org for information on veteran w/ dependents and surviving spouseExample: single veteran w/o wifeMAPR (Max annual pension rate) $22,939 or $1,911.58 per monthBasic Pension + housebound + Aid and Attendant Service Pension $13,752 annually (min.)Housebound $16,805 annually (mid.)Aid and Attendant $22,939 (annually max.)

18. VA requirements- for a Veteran w/o dependentsMAPR (Max annual pension rate) $22,939 or $1,911.58 per monthBasic Pension + housebound + Aid and Attendant Service Pension $13,752 annually (min.)Housebound $16,805 annually (mid.)Aid and Attendant $22,939 (annually max.)Requirements:90 days one day during a period of war Discharge honorable Income – to be reduced by the amount of reasonably predictable unreimbursed medical expenses exceed 5% of the MAPR Net worth assets + income (after medical expenses deducted) is less than $130,000Asset transfer- 3 year look back period apply to “covered assets”- amount over the net worth assets subject to penalty period/ loss of eligibility For assets transferred after 10/18/18

19. VA Medical requirementBasic PensionTo meet the disability requirement, a veteran must meet ONE of the following conditions:Be a minimum of 65 years oldHave a permanent (there is not a chance or is very little chance the disability will improve) and total (100% disability rating) non-service connected disabilityReside in a nursing home facility due to a disability and require long term careBe a recipient of disability benefits from Social SecurityAid & Attendance RequirementsFor the A&A Pension, a veteran or his / her survivor must meet ONE of the conditions below:Need assistance with Activities of Daily Living (ADLs), such as bathing, grooming, dressing, eating, and mobility.Be bedridden (confined to one’s bed)Be a resident of a nursing home facility due to the inability to function physically or mentallyHave profound visual impairment (both eyes have equal or less than 5/200 visual acuity OR the visual field has concentric contraction equal to 5 degrees or less)Housebound RequirementsTo be eligible for the Housebound Pension, a veteran or his / her surviving spouse must be “substantially confined” to his / her home due to a disability that is permanent.

20. What is a care manager and why you need oneAssists in locating appropriate long-term care placementAssess needs and situation to establish a plan of careYour own personal tour guide through the maze of healthcareMonitor care in nursing home, assisted living, adult day care, etc.Saves you time, energy and money, and provides peace of mind!www.aginglifecare.org

21. ResourcesElder Law Attorneyswww.NAELA.orgMedicare Coveragewww.medicare.govMedicaidwww.dads.state.tx.usVeteran’s Benefits1-800-827-1000www.va.govAARP - www.aarp.govAlzheimer’s Associationwww.alztex.com

22. Speaker contact information:Christina Lesher5615 Kirby Dr. Ste 412Houston, Texas 77005713-529-5900www.lawlesher.comFacebook:Law Office of Christina Lesher