Elder law attorneys are forced to explain some unpleasant truths to their clients, and one of them involves cognitive impairment. Alzheimer’s disease is a widespread threat because it strikes just under 13 percent of all seniors, and there are 200,000 people under 65 with the disease.
As you get older, the likelihood of contracting Alzheimer’s disease increases. It strikes 32 percent of the oldest old, which is a term that is used to describe individuals that are 85 years of age and older.
These figures are coming from the Alzheimer’s Association, and they have valuable information and resources to draw from. Their 24/7 helpline can be reached at 800-272-3900.
Experts have determined that staying engaged and mentally active can help stave off Alzheimer’s disease, but there are no guarantees. From a legal perspective, there are steps that you should take to prepare yourself to mitigate the negative impact if you contract the disease.
The first step is to include an incapacity component within your broader estate plan. If you do not take the matter into your own hands and you can no longer make sound decisions, the state can appoint a guardian to act for you. This is an outcome that can be hard on the entire family.
Plus, people that are close to you may not be in complete agreement with regard to the optimal way to proceed. Hard feelings can develop during a time when everyone should be pitching in to support one another.
You can prevent a guardianship if you execute a durable power of attorney for property. This document is used to empower an agent to make financial decisions on your behalf if it becomes necessary.
A living trust as an asset transfer vehicle that is preferable to a simple will in many ways. If you use a living trust to facilitate postmortem asset transfers, you would be the trustee while you are alive and competent.
In the trust declaration, you can give the successor trustee that will administer the trust after your passing the ability to manage the trust in the event of your incapacity.
Medical decision-making is part of this equation as well. You can name someone to make decisions on your behalf in a durable power of attorney for health care. A HIPAA release should be added to give your agent the ability to access your health care information.
A durable power of attorney for health care is an advance directive, and another directive called a living will should be included as well. This document is used to record your life support utilization preferences in a legally binding matter.
Nursing Home Asset Protection
Clearly, a significant percentage of people with Alzheimer’s disease ultimately reside in nursing homes with memory care units. Most Americans qualify for Medicare when there are 65, but this program does not pay for the custodial care that nursing facilities provide.
This gap has very significant ramifications because you can expect to pay over $150,000 for a year in a quality Hartford area nursing home.
Medicaid is a solution because this program will pay for living assistance, but there is a $1600 limit on assets in Connecticut. Your home is not counted, but Medicaid is required to seek reimbursement from your estate, so they could attach your home if it is in your possession.
As a response, you could convey your home, income-producing assets, and other resources into an irrevocable trust. You can accept distributions of the earnings while you are living independently, but the principal would be out of your reach.
If you fund the trust at least five years before you apply for Medicaid, the assets in it would not count, and they would be protected during the Medicaid estate recovery phase.
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Even though Alzheimer’s disease is relatively common, most people do not experience it, so it is not all gloom and doom. The point is to protect yourself if it strikes, and we can help you create an effective plan for aging that culminates in the passing of your legacy.
You can schedule a consultation at our estate planning offices in Glastonbury or Westport, Connecticut if you call us at 860-548-1000, and you can use our contact form to send us a message.
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