LONG TERM CARE PLANNING
At 65 years old, your odds of needing long term care are a staggering 70%! Couple this with the fact that the average monthly cost nursing home care in Los Angeles is more than $9,000 (over $100,000 per year)!
On top of these staggering statistics, Medicare does not pay for long term care.
So, how will you pay for nursing home care if you need it?
The high costs of nursing home care can drain your life savings very quickly. If you are married and only one spouse requires nursing home care, what will be left for the “well” spouse to live on?
Happily, there is a program that can assist you or your loved one with paying for long term care: Medi-Cal, which is California’s Medicaid program.
Medi-Cal can be a financial lifesaver when you or your loved one needs nursing home care. But there’s a catch: Medi-Cal has extremely strict asset and income requirements. Recipients must have less than $2,000 a month in income and less than $2,000 in assets.
If the Medi-Cal recipient is married, their spouse is allowed a maximum of $128,640 in assets (in 2020). The “well” spouse’s income is not counted against the applicant.
If you’ve built up a nest egg that you were hoping to live on, and have something to leave to your family, these numbers can be frightening.
But there is good news.
With proper planning you can protect your family’s life savings and still qualify for Medi-Cal.
Planning ahead is vital to making sure that money is available when you need it and to ensure that you do not spend down your assets or squander your legacy, leaving you and your family unprotected.
Medi-Cal planning often involves creating a special trust designed to hold the property and assets that you want to protect. There are strict rules regarding the creation and maintenance of these “Medi-Cal Asset Protection Trusts,” and we strongly recommend following the advice of a Medi-Cal planning attorney to help you create and fund your trust.
When should you start your long term care planning?
California currently has a 30 month “look back” period. This means is that if you give away assets (even to a trust) less than 2 ½ years before applying for Medi-Cal, you become ineligible for up to 2 ½ years (based on the amount of money transferred). The good news for California residents is that in all other states the “look back” period is 5 years!
Thatcher | Law can help you create a strategy that is specifically designed to fit your family’s needs and time table.
There are planning tools that can be used if you need care urgently. Some additional steps you can take include spending money on certain home improvements, planned purchases and strategic gifting.
At Thatcher | Law we can help you find the balance between protecting your legacy and having enough money to live on in the here and now.
If you think that long term care or Medi-Cal planning is right for your family, contact Thatcher | Law. Some of the questions we will help you answer are
- Why is Medi-Cal planning important?
- How soon do I need to start planning to qualify for Medi-Cal?
- How does a Medi-Cal planning strategy work?
- How can a Medi-Cal planning attorney help me?
Whether you are planning for the distant future, or your family’s needs a solution immediately, Thatcher | Law can help you with your long term care and Medi-Cal planning needs.
Contact us to see how we can help you and your family.