According to LongTermCare.gov, almost 70% of people who are 65 years of age at this time will need long-term care at some point in their lives. Such care is expensive and could deplete a lifetime of savings in just a few years. People may be able to both pay for their long-term care and leave money for their heirs by establishing trusts for long-term care planning.
Medicaid Requirements
Many people hope that Medicaid will pay for their long-term care. However, Medicaid only pays for people with limited income and few resources. Applying can be difficult as applicants are required to submit numerous supporting documents.
Another important thing to remember is the Medicaid 60-month look back period. Medicaid reviews an applicant’s financial records for the 60 months before the date of application. Financial transactions made during that time, including transfers to a trust, may cause a delay or reduction in benefits. That’s one reason it’s important to start planning now. A trust may be in your future.
Irrevocable Trusts for Long-Term Care Planning
Please note that there are two general types of trusts: revocable and irrevocable. Revocable living trusts are common. However, they typically do not provide any kind of asset protection and are not helpful for long-term care planning.
Instead, consider establishing an irrevocable trust. This type of trust transfers control of the grantor’s assets to a trustee. In effect, the grantor no longer owns the trust assets. Medicaid generally does not count the funds in an applicant’s irrevocable trust toward the applicant’s resource or income requirements.
Plan Ahead to Pay for Long-Term Care
We don’t know what the future holds or how long it will be until we need long-term care. To prepare for your future, talk to an attorney about trusts for long-term care planning today.
The attorneys at Miller Estate and Elder Law assist their clients with Medicaid and long-term care planning, as well as general estate planning. Contact Bill Miller at 256-251-2137 to schedule an appointment. Though our office is now located at 818 Leighton Avenue in Anniston, we serve clients in Gadsden, Hoover, Talladega, Vestavia Hills, and surrounding areas.
Also, download a copy of our free e-book, Don’t Go Broke Paying for Long-Term Care, by clicking here.