Medicaid Long Term Care Asset Protection
The Cost Of Long-Term Care In idaho
Your doctor tells you life altering news, “You need Long Term Care and Medicare won’t pay for it.” You must either pay out-of-pocket or be broke to qualify for government assistance.The average cost of long-term care in Idaho nearly $10,000 per month. Giving away your assets to qualify for government help can actually disqualify you for the government assistance you seek.Idaho Law Group can help you navigate complex asset protection rules and laws to qualify for Medicaid while preserving assets you are legally allowed to protect.
Will I Need Long Term Care?
The current average monthly cost of staying in a Long Term Care facility in Idaho was $9,481 in 2022. However, the cost of Long Term Care keeps rising by more than the rate of inflation.
- Almost a 70% chance. If you are turning 65 today, you have nearly a 70% chance of needing some type of Long Term Care services and supports in your remaining years. (U.S. Department of Health and Human Services);
- 53% of all women. Greater than half of all women will require Long Term Care in their lifetimes. (AARP Public Policy Institute)
- 47% of all men. Almost half of all men will require Long Term Care in their lifetimes. (AARP Public Policy Institute)
- 20% longer than 5 years. On average, women are in Long Term Care for 3.7 years while men only remain in care for 2.2 years. However, of those receiving care, 20% need care for longer than five years. (LongTermCare.gov – 2018)
Will Medicare Pay for Long Term Care?
People over the age of 60 rely on Medicare to cover most of their medical expenses. However, Medicare will not cover Long Term Care.
If you are dismissed from the hospital to a Long Term Care or Rehabilitation facility:
Limit On Time – Medicare will cover “skilled” services or rehabilitation in a facility if the patient is making progress
- Maximum of 100 days – Even if a person receiving rehabilitation services is still progressing, the maximum amount of time Medicare will pay for care is 100 days.
- Average of 22 days – Medicare will stop paying when they patient has recovered or if they stop improving. On average Medicare will only authorize payment for 22 days
Limit On Services – Medicare does not pay for non-skilled assistance with “Activities of Daily Living” (ADL). Assistance with activities of daily living make up the bulk of the services received in a facility. ADLs not covered by Medicare include:
- Transferring – Help getting into our out of bed or a chair, including a wheelchair, is not covered by Medicare.
- Toileting – Help getting onto or off of the toilet and assisting with toileting hygiene is not covered by Medicare.
- Bathing – Help bathing, showering, and other assistance needed with personal hygiene is not covered by Medicare.
- Dressing – Help to get dressed or undressed is not covered by Medicare.
- Eating – Help preparing food and eating is not covered by Medicare.
- Ambulation – Help walking or climbing stairs is not covered by Medicare.
Will Medicare Pay for Long Term Care?
People over the age of 60 rely on Medicare to cover most of their medical expenses. However, Medicare will not cover Long Term Care.
If you are dismissed from the hospital to a Long Term Care or Rehabilitation facility:
Limit On Time – Medicare will cover “skilled” services or rehabilitation in a facility if the patient is making progress
- Maximum of 100 days – Even if a person receiving rehabilitation services is still progressing, the maximum amount of time Medicare will pay for care is 100 days.
- Average of 22 days – Medicare will stop paying when they patient has recovered or if they stop improving. On average Medicare will only authorize payment for 22 days
Limit On Services – Medicare does not pay for non-skilled assistance with “Ac tivities of Daily Living” (ADL). Assistance with activities of daily living make up the bulk of the services received in a facility. ADLs not covered by Medicare include:
- Transferring – Help getting into our out of bed or a chair, including a wheelchair, is not covered by Medicare.
- Toileting – Help getting onto or off of the toilet and assisting with toileting hygiene is not covered by Medicare.
- Bathing – Help bathing, showering, and other assistance needed with personal hygiene is not covered by Medicare.
- Dressing – Help to get dressed or undressed is not covered by Medicare.
- Eating – Help preparing food and eating is not covered by Medicare.
- Ambulation – Help walking or climbing stairs is not covered by Medicare.
Will Medicare Pay for Long Term Care?
People over the age of 60 rely on Medicare to cover most of their medical expenses. However, Medicare will not cover Long Term Care.
If you are dismissed from the hospital to a Long Term Care or Rehabilitation facility:
Limit On Time – Medicare will cover “skilled” services or rehabilitation in a facility if the patient is making progress
- Maximum of 100 days – Even if a person receiving rehabilitation services is still progressing, the maximum amount of time Medicare will pay for care is 100 days.
- Average of 22 days – Medicare will stop paying when they patient has recovered or if they stop improving. On average Medicare will only authorize payment for 22 days
Limit On Services – Medicare does not pay for non-skilled assistance with “Activities of Daily Living” (ADL). Assistance with activities of daily living make up the bulk of the services received in a facility. ADLs not covered by Medicare include:
- Transferring – Help getting into our out of bed or a chair, including a wheelchair, is not covered by Medicare.
- Toileting – Help getting onto or off of the toilet and assisting with toileting hygiene is not covered by Medicare.
- Bathing – Help bathing, showering, and other assistance needed with personal hygiene is not covered by Medicare.
- Dressing – Help to get dressed or undressed is not covered by Medicare.
- Eating – Help preparing food and eating is not covered by Medicare.
- Ambulation – Help walking or climbing stairs is not covered by Medicare.
What Are My Options
Without the assistance of Medicare, the monthly expense is difficult for most families to cover. There are three options to pay for Long Term Care expenses.
Long Term Care Insurance is designed to pay for chronic medical conditions. These policies pay a daily rate.
- Cost – According to the 2020 Price Index, a healthy 55 year old male should expect to pay about $1,700 per year for a policy that offers benefits of $164,000. If unused, those benefits compound over time to offer $386,500 by the time he has reached 85 years of age.
- Tax Deductions – If you itemize your deductions, Federal and Idaho tax laws allow a deduction for part or all of your Long Term Care insurance premiums as medical expenses.
- State Partnership Program – Having a qualifying Long Term Care policy enables you to apply for Medicaid under modified rules. This allows you to keep more resources and still qualify for Medicaid.
Long Term Care Insurance is designed to pay for chronic medical conditions. These policies pay a daily rate.
- Cost – According to the 2020 Price Index, a healthy 55 year old male should expect to pay about $1,700 per year for a policy that offers benefits of $164,000. If unused, those benefits compound over time to offer $386,500 by the time he has reached 85 years of age.
- Tax Deductions – If you itemize your deductions, Federal and Idaho tax laws allow a deduction for part or all of your Long Term Care insurance premiums as medical expenses.
- State Partnership Program – Having a qualifying Long Term Care policy enables you to apply for Medicaid under modified rules. This allows you to keep more resources and still qualify for Medicaid.
Without the help of any insurance, an individual is required to pay for Long Term Care from their own resources. In Idaho, the average expense will be near $117,000 per year. Bank accounts can drain quickly at this rate. One way individuals sometimes raise the needed funds is to get a reverse mortgage on the family home.
Many people believe that they are required to use all of their resources to pay for this care until they are poor enough to qualify for Medicaid. Idaho Law Group may be able to help you qualify more quickly while preserving a significant percentage of your assets.
Medicaid is a needs based benefit to pay for medical care. If you qualify, Medicaid can pay for Assisted Living, Home Health Care, or a Skilled Nursing Facility. Whether someone needs care immediately or there is time to plan, Idaho Law Group works with individuals and families to design plans that
- Protect the most assets,
- Qualify for Medicaid as quickly as possible, and
- Allow for the best care to be provided to loved ones in need of Long Term Care.
How Does Medicaid Planning Work?
The laws surrounding Medicaid are extremely complex. It is a federal program which each state manages with some differences. Because Idaho Law Group knows how to work within the rules, surprising and beneficial things can be accomplished. The following cases illustrate what is possible.
Case #1
Pauline has been diagnosed with dementia. She wants to be able to pass something along to her children. She comes to Idaho Law Group for help.
Pauline’s Income – $1,800 per month
Pauline’s assets – $150,000
Pauline’s cost of Long Term Care – $8,300 per month
Instead of waiting for Pauline to spend her $150,000 on Long Term Care, Idaho Law Group assists her with a gifting strategy that works within the Medicaid rules.
Once the plan is put into place, Pauline is able to qualify for Medicaid immediately. There will be a period during which Medicaid will not pay, but the plan covers that. Pauline was able to protect a little over half ($75,848) of her assets and pass them to her children.
Case #2
Arthur and Mary are married. Arthur has just been diagnosed with dementia. He wants to make sure Mary has all she needs when he is gone. They come to Idaho Law Group for help.
Arthur’s Income – $2,000 per month
Mary’s Income – $1,500 per month
Joint Assets – $300,000
Arthur’s cost of Long Term Care – $8,500 per month
Idaho Law Group helps Mary and Arthur create a plan where Mary gets to keep $125,000 of assets. An additional $157,000 of assets are turned into an income stream that will pay the $157,000 back to Mary in 36 months. Arthur is immediately qualified for Medicaid without paying the Long Term Care facility and without any Medicaid penalty period.
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