News & Resources: Blog

Planning for Long-Term Care

Published: July 9, 2021

According to the U.S. Department of Health and Human Services (DHHS)’s Administration on Aging (AOA), around 70 percent of people over the age of 65 will require long-term care services at some point in their life. This means they will need assistance with at least two activities of daily living (ADLs) such as eating, dressing, or bathing. Some may need an even higher level of care such as skilled nursing care. Typically, long-term care refers to care that is delivered at home, in a hospital, or in an assisted living facility. When long-term caregiving needs arise, because of illness, disability, or increasing personal care needs, paying for care can become a significant burden upon them or their family. At Scott Bloom Law, we have a long track record of helping elderly individuals and their families in developing a plan for long-term care and choosing the best options in each case. Below we will discuss some common questions people have about long-term care.

How long will I need long-term care?

According to the latest AOA research, the average woman needs long-term care services for 3.7 years, and the average man for 2.2 years. Keep in mind, these numbers may include some combination of care within the home (provided by family members and/or paid caregivers), care in an assisted living community, and/or care in a skilled nursing facility. Meanwhile, sixty percent of assisted living residents will eventually need a higher level of care, often necessitating a move to a separate skilled nursing facility.

What are my options for paying for long-term care?

Here are some of the options available when paying for any type of long-term care.

1. Cash/Private Pay– The very wealthy can simply pay out of pocket for whatever long-term care they need. These costs can range from approximately $30,000 per year to $150,000 per year. All but the wealthiest individual will find that long-term care costs are absolutely devastating to the life savings of the long-term care recipient and will put undue stress upon their spouse and/or family.

3. VA– Veterans and spouses of veterans may have access to an improved pension for the elderly and disabled that may provide about $1,000 – $2,000 per month depending on a variety of factors. The VA Improved Pension / VA Aid and Attendance benefit can be extremely useful for those elders who need assistance paying for home health aides and assisted living facilities. However, the benefit will not be of much use for those requiring nursing home level of care.

4. Medicaid– Medicaid is a federal-state program that provides medical assistance to low-income individuals, including senior citizens (65 or older). It is the largest payer of nursing home bills in the United States and a final resort for those who have run out of ways to pay for their long-term care. To qualify, your assets and monthly income must fall below a minimum standard.

Why Do I Need to Protect Assets from Nursing Home Costs?

Since Medicaid eligibility is based on income, a person’s assets could be depleted by the time they qualify for Medicaid coverage. They may not have anything left for their own living costs if they leave the nursing home or for their loved one’s inheritance. In addition, when a Medicaid recipient dies, the government will try to recover what they paid out in benefits for nursing home coverage to the decedent.

How Do I Protect My Assets from Nursing Home Costs?

This is where early planning is most beneficial. Protecting assets from nursing home costs can be done with the guidance of an experienced attorney. There are various strategies we employ at Scott Bloom Law to maximize the protection of assets. It is important to remember that Medicaid has a five-year look-back provision. This means that the government can look back at assets that were transferred within a person’s estate for a five-year period before the Medicaid application. If the transfer was not exempt, the person may not be eligible for Medicaid for a certain length of time. For this reason, it is best to start with an attorney from the very beginning of estate and nursing home cost planning.

Due to the many facets involved, the importance of discussing your long-term care planning with an experienced elder law attorney can not be overstated. At Scott Bloom Law, we have helped countless elders and their families develop plans that takes both their current and future needs in to account. As with all planning, getting started as soon as possible is crucial in ensuring all of your needs are met.

At Scott Bloom Law, we are a team of advocates who care, always fighting for what’s best for our clients and their families. With knowledge, experience, and compassion, we strive to find solutions that make the aging process as emotionally and financially easy as possible. Visit us at scottbloomlaw.com or call 215-364-1111, to talk to find out more.

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It can be quite confusing to determine which Medicare plan is best for you. There are several types of plans, and each has its own advantages and disadvantages. Understanding some basic features will help you decide how to maximize your healthcare dollars and choices. You should review your choice periodically, especially as elements of the Inflation Reduction Act of 2022 change prescription medication and vaccine policies. Coverage can also change from year to year..

There are three basic types of plans:

Original Medicare
Medicare Advantage
Medigap

Original Medicare

Medicare is a government health insurance plan for people 65 and older. Original Medicare, sometimes called traditional Medicare, comes in several parts. Each part covers different things and has various associated costs.

Most people do not pay for Part A as it was deducted from their taxes paid while working. It is primarily for hospital visits and nursing care. However, there are many fees associated with being in a hospital that Medicare does not cover, which you still might have to pay out of pocket.

Part B requires monthly premiums, which can be deducted from your social security. You can elect to enroll in part B through Original Medicare. It covers a portion of doctors' visits, durable medical goods, and more.

Part D covers the cost of many prescription medications. You can add it to Original Medicare or purchase it as part of a Medicare Advantage plan.

Medicare Advantage

Medicare Advantage is offered through private insurance companies that Medicare approves. Most plans include Parts A, B, and D of Original Medicare with some variations from the original. There are a wide variety of Medicare Advantage plans, including Preferred Provider Organizations (PPO) or Health Maintenance Organizations (HMO). PPOs tend to have higher premiums and offer more choices than HMOs. Medicare Advantage HMOs and PPOs often have higher premiums than traditional Medicare because they usually cover more expenses, including prescription drug costs, vision, hearing, and dental.

However, the overall costs, premiums, plus out-of-pocket expenses for Advantage plans can be lower than Original Medicare because the private insurers manage patient care and limit choices. They assemble networks of hospitals and physicians to control their costs and reduce their customer's premiums. They also restrict access to certain providers and increase the cost of care obtained out-of-network.

Traditional Medicare allows people to seek care from any provider participating in Medicare, which includes virtually all hospitals and physicians.

Medigap

Medigap is a co-insurance or supplement to Original Medicare. You can enroll when you first enroll in Part B. It is also available through Medicaid, a union, or a former employer when you qualify for both programs. You can’t have both Medicare Advantage and Medigap plans. Medigap helps cover expenses that Original Medicare does not cover, such as co-pays and deductibles. Due to the enrollment restrictions, you should strongly consider Medigap when you first become eligible.

The Right Choice for You

With all the different plans, parts, choices, and restrictions, it is crucial to consider your priorities for care. Limited access to doctors and hospitals may become important if you need specialized medical care, such as cancer treatment. Before enrolling, consider what specialty hospitals are included in Advantage plans. Likewise, Advantage plans can make it difficult to see a specialist for ongoing and chronic conditions due to limitations in long-term care services. An estate planning lawyer or elder law attorney can help address long-term care planning and the potential to qualify for Medicaid when necessary.

The Kaiser Family Foundation has put together a cost analysis to help you determine when Medicare Advantage would save you money. As you can see, the longer you stay in the hospital, the less advantageous an Advantage plan becomes.

Consumer Reports notes that the JAMA reported that seniors on Advantage plans often get more preventive care than those on traditional Medicare plans. JAMA published a comprehensive paper about how Medicare plan choice affects spending and discovered that Medicare Advantage enrollees usually spend less.

A Guide in Choices after 65

Enrolling in the right Medicare coverage is one of many decisions that will affect your quality of life in your senior years. We are here to help you navigate a wide variety of choices.

If you have questions or would like to discuss your legal matters, please do not hesitate to contact our office at 215-364-1111 to schedule a consultation.

- Medigap, Medicare Advantage, and Traditional Medicare

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