Long Term Health Care Planning
While most people prefer not to burden their families as they approach a point of needing help, many do not plan specifically for their future care needs. The reason for this neglect may be that long-term care and insurance are believed to be too expensive or that they may not be aware of strategies that could provide peace of mind.
Families should considering discussing strategies with their elder parents to identify strategies before the need becomes apparent. If you need help planning long term health care, give the experts at Hammond and Associates a call at 240-200-5222 or fill out a contact form.
Cost of Long Term or Assisted Care
Eventually 70% of people aged 65 and older will require some form of assisted or long-term care. For a couple, this clearly implies that at least one partner is almost assuredly faced with the prospect of a nursing home or other situation in which care will be required. According to AARP, the average individual needs care for three years and about 20% will require care for five years or more. It is no secret that long-term care, assisted living and nursing homes will be expensive. Couples who have worked and saved to create a financial cushion frequently see these savings disappear as care costs wipe out their balances. The average cost of an assisted living facility in Maryland, for example, is about $3,900 per month. Nursing home costs can be triple that amount.
When the individual has used their assets, Medicaid will begin to contribute to the cost of care. Get in touch with Hammond & Associates to learn more about how to plan payments for long term care.
It is important to know that, under normal circumstances, simply transferring assets to a family member or other individual does not free those funds from jeopardy. The government expects the individual to use up virtually all assets before tapping into the Medicaid option. A mandated 5-year “look-back” regulation will determine if capital has been transferred during that period and penalties will result that can affect the Medicaid option.
Medicaid does allow the exercise of certain strategies that allow for the preservation of some or all of your capital. These options may include certain types of trusts or annuities that can be complex and require the assistance of an attorney experienced in elder situations. As with many decisions, the earlier you start the discussion, the better the potential outcome will be.
Long-Term Care Insurance
Long-term care insurance can preserve some of your accumulated capital. As with most insurance, the earlier you buy the policy, the lower the premiums. A healthy couple in their mid-50s may pay $2,500 per year for a policy. Some policies include in-home care in addition to nursing home assistance.
The coverage is not limitless. In an example cited by AARP, a policy purchased by a 55 year-old couple may cover up to $333,000 of long-term care. However as the premiums accumulate, the payout may reach $825,000 by age 85.The bottom line on long-term care insurance is that if you prove to be healthy and buy early enough, the premiums will be relatively low and the eventual payout grows in time. This option should be weighed carefully. As with any insurance purchase, you may end up getting paid back or you may not. But insurance can go a long way to preserving capital for the surviving family members.
If you have been active U.S. military during times of war, the Veterans Administration offers financial benefits for veterans and their spouses who qualify for assistance. Certain conditions must be met and the payout is currently at about $2,000 month, depending on the circumstances.
Planning Ahead Is Important
Whatever your circumstances, it is never too soon to begin thinking about long-term care for aging parents or yourself. There are strategies to consider that will at least provide some peace of mind in a painful situation. When you need help with long term health care planning for a loved one, let the attorneys at Hammond and Associates offer our assistance. Our attorneys have represented elder law clients throughout Montgomery County, Frederick County, Howard County, Prince George’s County, and the surrounding areas.
Our principal office is located in Bethesda, but for the convenience of our clients, we can arrange for conference rooms for client meetings elsewhere. If you live outside of the Bethesda area and would like to meet with Hammond and Associates, we can set up a meeting in the following locations: Rockville, Gaithersburg, Germantown, Fulton, Bowie, Columbia, Frederick, National Harbor, Annapolis, Pikesville, Owings Mills, Towson, and Hunt Valley.
Contact us online or call us at 301-861-4555 and we can discuss how we can assist with elder financial planning. We want to help you protect your loved ones in Maryland!