Protection from Long Term Care Costs, 07-20-2009
Did you know that the average cost to live in a nursing home facility in Arizona is $5,808 per month? This just covers the basics and does not include any extra amenities. As almost half of people over age 65 will need nursing home care, are you prepared to cover that cost out of your own pocket? If not, did you know that a trust prepared by Morris Hall can help?
All states have a Medicaid program which helps pay for long-term care services for those people who qualify. Unfortunately, according to Medicaid standards, you have to be broke—or close to it—to qualify. When applying for Medicaid, all assets have to be disclosed. Important planning techniques to re-characterize assets as uncounted resources require special language in your trust document. Medicaid Triggers—specific provisions in your MH trust—may allow your assets to be considered exempt from the spend-down provisions of your Medicaid. For example, with the Medicaid Triggers in your trust, if you needed long-term care, your trustee could:
- make home improvements to your residence,
- purchase an interest in a family member’s residence,
- make gifts to beneficiaries and,
- transfer title of assets from the trust to you.
These are only a few of the many things that can be done to protect your assets. If your trust was created or restated by MH after 2003, it contains Medicaid Triggers. These provisions provide your trustee with the authority to protect your resources.
For a married couple, you have additional protection when one spouse dies and the Family Trust is created. Although Family Trust assets can be used for the surviving spouse, the assets do not have to be spent prior to the surviving spouse qualifying for Medicaid. Without the benefit of the Family Trust, virtually all of the assets would have to be spent before the surviving spouse could qualify for Medicaid, leaving nothing left to pay for things that Medicaid won’t pay for.
If you do not have an Morris Hall estate plan with these special Medicaid protections, request a complimentary appointment to get started. Or, if you are already an Morris Hall client but haven’t met with us since 2003, it is important that you come in to review your trust. Most likely, it will not contain the special language needed to protect you from using your assets for long term care costs.