Elder Law FAQs
Medicare will not cover all of the cost of long term care, and it may not cover any of the costs. Medicare may cover a part of a duration of a stay in a skilled nursing facility under the following circumstances: 1) entrance in the skilled nursing facility was preceded by a 3 night stay in a hospital in inpatient status; 2) Skilled nursing care is needed for the same reason as the hospitalization; and 3) entry into the skilled nursing facility occurs within 30 days of hospitalization. Medicare will provide the following coverage once approved:
- 1st 20 Days: 100% of approved amount
- Day 21-100: 100% less $152 daily copay
- Beyond 100 days: Nothing
Medicare is a health insurance program for most people over the age of 65, and for those under the age of 65 who qualify for disability income (SSDI) or suffer from end stage renal disorder. Medicare is not an economic need based program. As described above, Medicare may cover some or none of the costs of long term care.
Medicaid is an economic needs based health insurance program. There are many different forms of Medicaid. In terms of long term care, Medicaid can cover the costs of a skilled nursing facility for those who qualify. To be eligible for Medicaid to cover the costs of a skilled nursing facility you must:
- Require skilled nursing care
- Be a US Citizen or Qualified Alien
- Be a resident of the state in which you apply for benefits
- Be over the age of 65 or disabled
- Be in a nursing home with a Medicaid bed available
- Have applied for all other benefits to which entitled
- Require care, the cost of which is greater than your income
- Have countable assets that are no more than $2,000 in value (generally)
- Have not made any sanctionable transfers of assets within the 60 months of the date of application
Presuming the institutionalized spouse has the capacity, or otherwise legal means to transfer assets, transfers between spouses are not sanctionable. [in other words, yes] However, note that there are assets limits as well for the community spouse.
Assets transferred to your children without fair compensation are sanctionable transfers, unless the child is disabled (or the transfer is to a trust for the benefit of the disabled child). In certain (and very specific) situations a home may be transferred to a child.
Long term care costs can vary wildly, depending on the type of care, and where the care will be provided. In 2014, the national average cost for a one year stay in a nursing home was $81,000. The cost of nursing home care is expected to increase 4.5% annually. The anticipated costs of a nursing home stay in 2030 is $146,000 annually. By far, the most expense form of long term is home care. The national median hourly rate for home health aide services is 2014 is $20 per hour. Considering round the clock care, home health aide services could amount to over $175,000 per year.
It is perhaps never too early to work with an experienced elder law attorney to develop an estate plan that plans for the cost of long term care. There are methods available to avoid a total spend down of assets in the event of a crisis. However, families that can do proactive planning at least five years before a disability will be best positioned.
The VA has a program similar to Medicaid to provide for the long term care of certain vets or their unmarried surviving spouses. This program is called VA Pension Benefits. It provides a monthly stipend to cover the costs of long term care. Basic criteria for eligibility for VA Pension Benefits is as follows:
- the veteran served at least one day during a War Time Period,
- the veteran served 90 consecutive days on Active Duty,
- the veteran received a discharge characterization as other than dishonorable,
- the veteran has limited income and assets, and
- the veteran is permanently and totally disabled.