Life with MS

Planning for Your Family’s Long-term Care

By Mark Shalloway, Esq.
If you are living with MS, it is important to begin planning for the future as early as possible. Because of the progressive nature of the disease, there may come a point when you need long-term care. Perhaps you’ve discussed the matter with your family and made plans. But what if long-term care becomes needed for your aging parents or your spouse? What happens if you are unable to provide that care? Have plans been made in the event that they need long-term services as well? Planning for future care needs should involve the whole family.
If you or a loved one is “middle class,” the single greatest threat to your family’s assets and independence is chronic or long-term illness like MS, Alzheimer’s, stroke, Parkinson’s, or lung disease. Unlike most heart attacks and cancers, these chronic diseases have long-term effects on your ability to dress, bathe, toilet, eat, and transfer (get in and out of a bed, chair, or car). At some point, a person with these conditions may need supervision or care from family, home health aides, assisted living, or a nursing home on a permanent basis – not just for a period of rehabilitation.
But this care can be expensive. Nursing homes range in cost from $8,000 to $12,000 a month in urban areas. Assisted living facilities cost $2,000 to $7,000 a month, and at-home aides range in cost from a few hundred to $10,000 a month. These costs can be catastrophic to the middle class and drain their life savings within a couple of months.
Will Medicare or insurance pay for my care?
Many assume that Medicare or health insurance policy(s) will pay for help you need from at-home aides, assisted living, or a nursing home. They won’t. Unless you’ve specifically purchased long-term care insurance, all other insurances, including the military Tri-care for Life, will not pay for this so-called “unskilled” or “custodial” care. In other words, if you don’t require a doctor, nurse, or therapist, it is not a service that is covered; these policies will not pay for someone to help you dress, bathe, feed, or toilet in a non medical setting. So Medicare and its various Advantage Plans and Supplemental or Medigap policies have what is called “short-term skilled care” coverage and will not pay for any care longer than about 100 days – whether you are in a nursing home, your personal residence, or anywhere else.
Long-term care insurance can be difficult to come by, and expensive. Studies show that premiums for long-term care insurance can cost from $40,000 to $100,000 during a 20-year period. Unless you are healthy enough to be deemed insurable and can afford premiums for more than 20 years, a LTC policy is not always the most affordable way to finance care.
If I am a veteran, will the VA Pay for my care?
Many veterans and their families mistakenly believe the VA will pay for at-home health aides, assisted living, or nursing home care because they use VA doctors and get their prescriptions from the VA. Typically only service-connected disabled vets may be an exception, but not for his or her spouse. Not even Tri-Care for Life will pay for pure unskilled custodial care in a nursing home.
However, wartime veterans and their surviving spouses, 65 years and older, may be entitled to a tax-free benefit called Aid and Attendance provided by the Department of Veteran Affairs. This can be planned for if a veteran has 90 days of active military service, one day during wartime and is discharged other than dishonorable.
How can Medicaid help?
Benefits can vary greatly by local area, but depending on where you live, Medicaid can likely pay for care in these three places:
1. Free home aids up to five hours a day. For example, an aide comes in the morning from 7 a.m. to 9 a.m. to help you dress, bathe, eat, toilet, and take medication, then returns at 5 p.m. to repeat, and leaves at 8 p.m. Medicaid will also pay for optional adult day care, diapers, prescriptions, medical transportation, physical and occupational therapy, and more. You can add or hire more hours a day to this on your own if you need.
2. Care at the assisted living facility. You pay for room and board (rent and food); Medicaid will pay the care portion of the monthly bill. For example, if the assisted living costs $3,200 a month, Medicaid will pay $1,200 for care, and you pay $2,000 for rent for the apartment and food for the month.
3. Medicaid pays the entire nursing home bill after your personal monthly income copay. Your share of cost in a nursing home is never more than your personal monthly income. For instance, if the nursing home costs $10,000 a month private pay, and you only have a social security check of $1,000, you only pay about that, or slightly less. If you are married, your spouse may be entitled to keep a portion of your income for his or her own living expenses, lowering your care costs even more.
Do I lose my Medicare if I’m on Medicaid?
You can keep your Medicare and add Medicaid. In fact, you can choose to be on Medicaid, Medicare, and if eligible, VA benefits, long-term care insurance and a Medicare supplemental policy all at the same time!
Who qualifies for Medicaid coverage?
To qualify, your cash assets are capped at $2,000, and there is an income cap as well. You can keep one home, most cars, and a few minor items. If married, your spouse (who is not applying for coverage) can hold about $100,000 in his or her name. With the exception of the items listed above, the rest of your assets are subject to this cap.
If you try to get “poor on paper” by gifting or transferring your accounts within five years of applying for Medicaid, you can incur penalties, and you must disclose that information or you will be denied benefits and coverage.
What is estate planning for Medicaid?
The goal in estate planning for Medicaid is to protect assets and not always have to wait five years for eligibility.
Medicaid wants you to think you must spend your life savings before you can qualify, but that is not the case. They hope you are uninformed and misled into spending down all you have in your checking, savings, CDs, stocks, bonds, mutual funds, annuities, IRAs, 401(k), brokerage accounts, cash surrender value of life insurance, and real estate. Good planning can preserve the assets that provide security for you and your family.