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"How to get Medi-Cal coverage for your nursing home care... without selling your home or leaving your family without a dime... Surprising ways to pay for your assisted living and long term care costs."

Elder Law Today Newsletter | April, 2013

 

Now is the Time to Get Your Ducks in a Row For Your Long Term Care Planning

You should “Get your ducks in a row” for your long term care planning, now, before a crisis occurs. Long term care planning and asset protection is much more difficult to accomplish if you see your elder law attorney after you or your loved one is in the hospital or in a nursing home. In addition, long term care planning becomes even more difficult if you or your loved one contact your elder law attorney after memory issues have set in.

First Thing To Do: Update Your Estate Planning Documents

The majority of estate planning documents, including revocable living trusts and financial durable powers of attorney, do not have the appropriate provisions and language for government benefits planning and asset protection. Most of our clients want to be able to qualify for Medi-Cal, if possible, to help pay for a nursing home stay, and they want to protect their assets from a Medi-Cal lien if they die after having been on Medi-Cal.

The home is usually our clients’ biggest asset, and is the part of their legacy that they want to preserve most for their loved ones.

By following the regulations for Medi-Cal planning at the appropriate time, we can transfer the home to a spouse or a child as a gift, without a Medi-Cal qualification penalty. The transfer must be accomplished in a specific manner so that we avoid the various tax issues. This step will also protect the home from a Medi-Cal lien if you pass away after having been on Medi-Cal. If you lose capacity and we need to take these steps for you when a crisis occurs, we will be required to look at the language in your revocable living trust and financial durable power of attorney for the appropriate provisions. If your documents do not have these provisions, we will not be able to take these steps without going to Court. Court petitions are expensive, and results from various Courts can vary.

Other Language for Making Gifts:

Medi-Cal regulations provide for gifting of other assets, but penalties can result from the transfers. If you lose mental capacity however, gifting may not be possible at all, unless you have the appropriate language in your estate planning documents. You can avoid many of these issues by updating your estate planning documents long before a crisis occurs.

Have You Chosen The Right Fiduciaries?

Are you comfortable with the people you have chosen to handle your financial and health care decisions? Family dynamics and circumstances may have changed since you first chose your fiduciaries. If you are unable to handle your own affairs because you have lost your mental capacity, you may not be able to change the persons you have initially chosen. Also, you should not feel obligated or pressured to choose any particular individual for these positions. Please keep in mind also that the person who is best suited to handle your financial affairs may not be the best person to handle your health care decisions.


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