Most people recognize the need to plan ahead for their active retirement years, but you should also get ready for the twilight years that are likely to follow. It may not be the most pleasant subject to contemplate, but everyone should be aware of the widespread nature of dementia among elder Americans.
Alzheimer’s Disease
Any conversation about dementia among our elders begins with a look at Alzheimer’s disease.
If you are seeking information about Alzheimer’s, a good place to visit would be the Alzheimer’s Association website. According to the site, one out of every eight individuals who is at least 65 years of age suffers from Alzheimer’s disease. If you do the math, this factors out to 13 percent.
As you get older, it becomes more and more likely that you will contract Alzheimer’s disease. Upwards of 45 percent of the oldest old (people 85 and over) are Alzheimer’s sufferers. This segment of the population is growing faster than any other.
Once you reach your 65th birthday, it becomes statistically likely that you will live into your 80s.
Those who suffer from Alzheimer’s induced dementia often become unable to handle their own day-to-day needs, and as a result they require living assistance.
If you were to require long-term care because of Alzheimer’s induced dementia or for any other reason, you cannot count on Medicare to pay for it. This type of care is considered to be custodial care; Medicare does not pay for custodial care, and it is very expensive.
Connecticut Medicaid eligibility is the solution for many senior citizens who need long-term care. This government health insurance program will pay for long-term care, and this is why many elders seek eligibility, even if they were qualified for Medicare coverage at first.
Medicaid is a program that is only available to people who can prove that have a significant level of financial need. As a result, there is an asset limit of $2000 for an individual applicant.
To obtain Connecticut Medicaid eligibility, you could give assets to your loved ones, but there are some things that you own that are not considered to be countable. Your home is not a countable asset (though there is $828,000 equity limit in Connecticut in 2016) but the home could be attached by Medicaid after you pass away if you retain ownership throughout your life. The program is required to seek recovery from your estate if you qualify for Medicaid to pay for long-term care.
One vehicle that is used as a primary source of transportation is not countable. Your wedding ring, your engagement ring, and your heirloom jewelry are not countable, and your household items and personal belongings are not counted. You can have unlimited term life insurance, which is life insurance that does not have a cash value. Up to $1500 in whole life insurance coverage is acceptable, and you can have the same amount set aside for final expenses.
Plus, there are protections in place for a healthy spouse who is capable of independent living while his or her spouse is applying for Medicaid to pay for long-term care. First off, there is no home equity limit. Secondly, the healthy spouse can keep half of the shared countable assets up to a limit of $119,220.
The healthy spouse can also be eligible to receive a Monthly Maintenance Needs Allowance. This would allow the healthy spouse to continue to receive income that is due to the institutionalized spouse. Under different circumstances, the income would go toward the cost of the care that is being received.
Medicaid Look-Back
If you give countable assets to your family members so that you can qualify for Medicaid, you have to be aware of the fact that there is a 60 months look-back period. You have to complete your gift giving at least five years before you apply for coverage, or you are penalized.
The length of the penalty is calculated based on the amount of the gift giving. To provide a simple example, if you gave away enough to pay for one year of long-term care, your eligibility for Medicaid would be delayed by one year.
Because of the existence of this Medicaid look-back, to qualify at the ideal time, you must plan ahead in advance.
Attend a Free Seminar
If you would like to obtain more information about long-term care, nursing home asset protection, and estate planning, attend one of our upcoming seminars. These sessions are free to attend, but we do ask that you register in advance. You can visit our
seminar schedule page to get all the details.
Mr. Nirenstein is licensed to practice before the courts of the State of Connecticut and the United States District Court. He is a member of the Connecticut and Hartford County Bar Associations, and the Estate and Probate, Elder Law, Business Law and Real Estate Sections of the Connecticut Bar Association.
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