Protecting assets, navigating the Medicaid process and planning in advance of a crisis are just some of the goals for our Elder Law clients.
Elder Law Attorney Services
The term Elder Law refers to the client, rather than the area of practice. The elderly client has unique financial, physical and emotional concerns that demand the best advice and lasting solutions.
Whether it’s planning for incapacity or stepping in at a time of crisis, assets need to be protected, the best healthcare must be fought for, financial decisions need to be managed and government benefits like Medicaid have to be maximized.
What is Elder Law?
Elder Law is an area of the law that deals primarily with planning for incapacity. Many documents used in Estate Planning overlap with Elder Law planning such as Powers of Attorney, Health Care Proxies and Living Wills.
Do I need a Durable Power of Attorney?
It is a document that allows you to appoint one or more persons to make your business and financial decisions and this becomes even more crucial should you become incapacitated. Upon incapacity, the person you appoint can even be authorized through the Power of Attorney for Medicaid planning to protect your assets.
Do I need a Health Care Proxy?
A Health Care Proxy is a document that allows you to appoint someone to make your health care decisions if you are unable to do so yourself. It is important to choose someone who is familiar with your healthcare wishes to make decisions for you, rather than the medical professionals.
What is a Living Will?
While a Health Care Proxy is the accepted document used to make health care decisions in New York, the Living Will is the accepted document used in other states. Essentially, the Living Will provides more detailed information about what procedures you want or do not want if you are incapacitated. In addition, in case your Health Care Proxy agent’s decisions are challenged, the language in the Living Will can also be used as clear and convincing evidence of your wishes in a New York court.
What options do I have for long term care?
There are a number of options available for long term care depending on your medical condition and location.
Most people want to remain at home as long as possible. If you need medical care at home, you can pay privately which can be very expensive depending on how much care you need. You can also purchase a long term care policy with a home care component or you can apply for Medicaid. Medicare also covers some limited home care.
You can choose to reside in an assisted living facility which will provide meals and a room and activities to keep you active. In most assisted living facilities, you must be able to walk. This option is not covered by Medicare or Medicaid. You would have to pay privately for this option.
Continuing Care Retirement Community:
This living arrangement provides a continuum of care ranging from independent living to assisted living to nursing home care all in the same community. Generally, there is a large up front fee followed by a monthly fee. This option is not available to persons who can not afford the up front fee and the monthly fee.
Sometimes this is the only option for persons whose medical condition requires a lot of supervision and/or care. While you can pay privately for a nursing home, current average nursing home costs are around $11,000 per month which will eat up your assets very quickly. Many people do Medicaid planning so they can apply for Medicaid to cover this cost.
What is Long Term Care insurance?
Long Term Care insurance generally covers nursing home and home care costs depending on the policy. You should try to secure the best long term care insurance you can afford. The goal is to cover your daily cost of care with a combination of policy payments and your income so you will not be depleting your assets. The cost of the insurance depends on the type of insurance you purchase, the length of coverage, elimination periods and other options. Consulting with an Elder Law attorney can open your eyes to what options are especially useful if you become incapacitated and any problems associated with your policy you are not aware of.
Do I need to protect my assets if I have Long Term Care insurance?
You should still consult with an Elder Law attorney if you have such insurance. Commonly, we find the policy is insufficient to pay for the daily cost of care even when combined with your income. It may be suggested that you increase certain options or the length of the policy. If your policy only covers a short time period and your assets will then be exposed, additional asset protection planning may be necessary.
What if I do not qualify for Long Term Care insurance or it is too expensive?
If this is the case, meet with an Elder Law attorney to discuss options for protecting your assets since Medicaid may be your only option to pay for long term care.
What are some options for protecting my home and assets if I need to apply for Medicaid?
Currently, in order to qualify for Medicaid in a nursing home, you can only have $13,800 in your name and certain other assets like an irrevocable prepaid funeral plan. For every $11,445 you give away to a person (other than your spouse with certain other exceptions) or an irrevocable trust, you are not eligible to receive Medicaid for one month. This is called the “penalty period”. This means that the greater the assets you want to protect, the earlier you should start planning.
The biggest asset most people try to protect is their house. An outright transfer to family members is usually not suggested because you lose all control and there are capital gains consequences to your family. A better option is to deed the house to family members with a retained life estate for yourself. This gives you the right to live in the house for the rest of your life and continue to receive all STAR and senior citizens exemptions. Upon your death, the house passes automatically to the beneficiaries and they do not have to pay capital gains tax when they sell the house at your death. This is not suggested if you want the option of selling the house while you are alive for reasons which should be discussed with your attorney.
The best option which affords maximum flexibility is to transfer the house to an irrevocable trust. An irrevocable trust is an agreement between you and a trusted person who acts as trustee to take care of your assets. Such a trust can give you the right to live in the house for the rest of your life and continue to receive all STAR and senior citizens exemptions. At your direction, the trustee can sell the house and purchase another house for you. You would be entitled to all the income from the trust depending on how it is drafted.
Cash assets can be transferred outright to family members. However, by doing this, you relinquish all control. Sometimes, a better option is to use an irrevocable trust as described above.
Highly appreciated assets such as stock should not be transferred outright if possible.
Instead, it is better to use an irrevocable trust so that upon your death, the stock can be sold and the beneficiaries will not have to pay capital gains tax.
All of these options can create a Medicaid penalty period and should be explored with a knowledgeable Elder Law attorney first before you make any transfers of property. The best time to do Medicaid planning is when you are well. Planning in a crisis situation does not always allow for complete protection of your assets.
How do I get Medicaid?
Obtaining Medicaid is a complicated application and eligibility process. A knowledgeable Elder Law attorney aware of all the intricacies of Medicaid law can show you the best way to protect your assets and can take you through the maze of Medicaid requirements. Learn more about Medicaid.