One of your primary goals throughout the course of your life is undoubtedly to acquire sufficient assets to ensure a comfortable retirement with something left over to pass down to future generations. Acquiring assets, however, won’t do you much good if you fail to protect those assets once you have them. Sometimes, threats to your assets are not very obvious. For example, have you ever considered the high cost of nursing home care to be a threat to your assets? The Vero Beach asset protection planning attorneys at Kulas & Crawford explain why you should consider nursing home costs to be a significant threat to your estate assets.
Your Odds of Needing Nursing Home Care
Unfortunately, there is no crystal ball that can yell any of us, with certainty, whether or not we will end up in a nursing home. As you age though, the odds of needing long-term care increase with each passing year. When you enter your retirement years you already stand a 50-70 percent chance of needing some type of long-term care (LTC) services before the end of your life. The longer you live, the higher the odds that you will end up in a nursing home – and the cost of that care will be high. Nationwide, the average cost for a year in long-term care (LTC) was over $80,000 for 2017. In the State of Florida, you can expect to pay more than the national average. That same year of LTC averaged over $105,000 in 2017 for Florida residents. Considering the average length of stay is about three years, your nursing home bill could easily run over $300,000 – and that is if you need LTC now. In just ten years, experts estimate that same LTC bill will run over $400,000.
How Will You Pay Your Nursing Home Bill?
If you are accustomed to relying on health insurance to cover your healthcare expenses, this may not sound as problematic as it really is; however, most health insurance policies will not pay for LTC unless you purchased a separate LTC policy at an additional expense. Medicare won’t be able to help either because the Medicare program only covers LTC expenses when they follow an inpatient hospital stay – and even then, only for a short period of time. For over half of all seniors currently in LTC, the only viable option for help covering LTC costs is Medicaid.
How Does the Need to Qualify for Medicaid Threaten Your Assets?
Medicaid is a federal healthcare program targeted at providing healthcare services to low-income individuals and families. If you made a moderate to high wage over the course of your working career, you probably never qualified for Medicaid. As such, you never considered the eligibility requirements. Because Medicaid is a “needs-based” program that is intended to help low-income individuals and families with healthcare expenses, the program uses both income and assets limits when determining eligibility. An applicant cannot own countable resources (assets) valued at more than the limit or the application will be turned down. As an individual applicant, your countable resources cannot exceed $2,000. It is the asset limit requirement that can ultimately threaten your hard-earned assets because if your assets exceed the limit, your application will be denied and you will have to “spend-down” those assets until they fall below the limit. In other words, you could be forced to rely on your retirement nest egg to pay for your nursing home expenses, until those assets are gone and you meet the Medicaid asset limit eligibility requirement. The good news is that there are a number of perfectly legal asset protection tools and strategies that can be incorporated into a Medicaid planning component within your estate plan to ensure that your assets are protected and you qualify for Medicaid if you need it in the future.
Contact Vero Beach Asset Protection Planning Attorneys
Please join us for an upcoming FREE seminar. If you have additional questions or concerns about asset protection or Medicaid planning, contact the experienced Vero Beach asset protection planning attorneys at Kulas & Crawford by calling (772) 398-0720 to schedule an appointment.