By Laurie Ohall, Florida Board Certified Elder Law Attorney
Long term care planning is an important issue which everyone will face sooner or later. Almost everyone knows someone in a nursing home or other care facility, yet this issue is something that we do not want to face. According to a study published by the New England Journal of Medicine almost half of all Americans will spend some time in a nursing home.
There are five ways to pay for a nursing home: private pay, long-term care insurance, Medicare, Veterans benefits, and Medicaid. Less than 10% of Americans have long-term care insurance or receive Veteran benefits. Additionally, Medicare will only pay up to 100 days. And, the average cost of a nursing home in the United State is approximately $6,000 per month, and in some areas it exceeds $10,000 per month, so private pay may be the way to go for some, but for most, they would be destitute in no time. So what about Medicaid?
First, let’s get one thing straight – Medicare and Medicaid are two completely different programs. Medicare is a federally run program, a government-run health insurance plan, for those age 65 and above. Coverage is short term (maximum 100 days) and you do have to pay a deductible.
Medicaid, on the other hand, is still believed to be by many seniors, a welfare program. However, with the advent of the Medicare Catastrophic Coverage Act of 1988 and Florida state regulations, the government has expanded the program from a welfare program to a middle class entitlement program allowing for spouses to live in financial security and allowing for assets to be passed to the next generation. Medicaid is a joint federal and state program with similar guidelines but with specific variations in each state which offers coverage for long-term (skilled or custodial) care in most nursing homes, and covers those age 65 or disabled, and impoverished (as defined by Medicaid’s rules – there’s that “welfare” word again). Medicaid requires that the applicant pay all or a portion of income to the nursing home as a co-pay.
As you can imagine, the laws regulating Medicaid are convoluted and not that easy to understand. Additionally, the laws in Florida recently changed, effective November 1, 2007, and these new laws have expanded the look-back periods from three to five years and changed the way Medicaid looks at transfer penalties – so beware if you think it is still ok to transfer monies to family members a little bit at a time! While the specific rules in Florida regarding Medicaid go beyond the scope of this article, by carefully designing a thorough Medicaid plan, the well-spouse can have a sense of security and a legacy can be preserved for your children. Due to the changes in the laws, it is extremely important to get the advice of an Elder law attorney who is familiar with the new rules. With the proper planning and implementation of a plan, a significant amount of assets can be saved.
The Law Offices of Laurie E. Ohall, P.A., represents clients throughout the Central Gulf Coast of Florida, including the following cities: Tampa, Brandon, Riverview, Gibsonton, Thonotosassa, Valrico, Plant City, Apollo Beach, Seffner, Bloomingdale, Sun City Center, Ruskin, Wimauma, Lutz and Temple Terrace.