“How to keep nursing home costs from devouring your life savings”

How to keep nursing home costs from devouring your life savings,” by Lou Michael, Buffalo News

“The state Health Department estimates the average annual cost of nursing home care in the Buffalo region at about $123,000, but it can be substantially more depending on the facility. Cappiello’s monthly checks to Elderwood at Lockport will add up to $144,000 by the end of this year. But he could have protected hundreds of thousands of dollars from the nursing home. Though complex, existing laws provide people with a pathway to protect their assets, become legally poor and qualify for publicly funded Medicaid to cover nursing home bills. … Elder law experts say the key to protecting one’s life savings is to take steps years before nursing home care is needed. They recommend:

  • Signing over the deed of your home to your children or others who would inherit it in your will. The transaction can stipulate you have life use of the home.
  • Establishing an irrevocable trust that upon death transfers the house to the beneficiaries. Again, life use can be stated.
  • Giving individuals one’s savings and other financial assets.

To protect these assets, transfers must occur more than five years before applying for Medicaid nursing home coverage. If an applicant owns financial assets or has given them in the Medicaid five-year ‘look back,’ there is a chance that they may still qualify for Medicaid benefits.”

LTC Comment (from Stephen A. Moses, President, Center for Long-Term Care Reform):

The only two inaccuracies in this article: all the laws permitting easy access to Medicaid aren’t complex and you don’t have to wait five years to protect assets. Medicaid eligibility workers routinely explain to applicants and their families how to protect substantial wealth by purchasing exempt assets. Nothing complicated about that; you don’t have to wait five years to do it; and the amount you can divert from LTC costs is unlimited. LTC insurance carriers, distributors and producers should fight against such perverse public policies . . . or at least support those of us who do. TGIF.