For some elderly citizens, remaining at home is no longer an option. Either physical or mental deterioration makes it impossible for them to carry out daily tasks, even with assistance from loved ones. Other seniors, however, may be able to live at home longer than they think. A recent article discusses considerations a person should make before committing to provide in-home care for a loved one.
First, consider what limitations your loved one faces. Are these limitations that a family member or in-home care worker can assist with? If your loved one requires regular doctor visits, could you arrange a doctor or nurse to make house calls? Finally, consider whether you can afford a personal-care assistant to assist with non-medical tasks such as meal-preparation, cooking and cleaning. Even hiring a person on a part-time basis will save you from the responsibility of 24/7 care.
If you plan on providing care to your loved one yourself, consider the toll the care may take on you. Often, family members undertake such tasks before realizing that they are ill equipped to deal with the unique tasks that aging individuals face. Additionally, if your loved one is unable to carry out simple tasks such as bathing, toileting, and dressing, a long term care facility may be the best and safest option.
For those engaged in the process of Long Term Care Planning, perhaps the most intimidating proposition is Medicaid’s look-back provision. This provision provides that certain assets that a person no longer owns will still count toward the calculation of his or her total assets to determine whether he or she qualifies for Medicaid coverage. A recent article discusses the look-back rules.
The Medicaid look-back period is the five years prior to that date upon which an individual applies for Medicaid benefits. All transfers made during this period are subject to scrutiny by Medicaid officials. For the purposes of calculating benefits, it is as though all gifts made during this period never occurred. For example, if an individual gave his or her child $20,000 the year before he or she applied for Medicaid coverage, the government would likely count that $20,000 towards the person’s assets to determine whether he or she qualifies for Medicaid.
Some individuals try to avoid the look-back provision by setting up a trust. Although Medicaid officials do not consider a trust to be a part of a person’s assets, assets moved into a trust are considered. Therefore, if assets are transferred to a trust during the five-year look-back period, Medicaid officials will take them into account.
Individuals often mistakenly believe that Medicaid has an annual gift-giving exclusion similar to that of the IRS. However, this is not true. Although the IRS allows taxpayers to give gifts up to a certain amount without invoking tax consequences, there is no parallel in the Medicaid determination.