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"How to get Medi-Cal coverage for your nursing home care... without selling your home or leaving your family without a dime... Surprising ways to pay for your assisted living and long term care costs."

Elder Law Today Newsletter | Vol. 12 | October, 2006

 

Long Term Care Provisions for the Revocable Living Trust and Financial Durable Powers of Attorney for Couples Facing an Diagnosis of Early Dementia

We often receive calls from one spouse, or from a child when one of their parents has had a stroke or has received a diagnosis of a dementia condition such as early Alzheimer’s. Both husband and wife usually still have capacity, but may be looking at some form of assisted living in the relatively near future, which may involve Medi-Cal.

An analysis should be made as to the steps that may be taken to eventually qualify the ill spouse for Medi-Cal. In addition, the revocable living trust and financial durable powers of attorney for these couples should be examined to see if they contain provisions that will help the couple qualify for Medi-Cal, and also provide for the protection of their assets against a state lien after the death of the ill spouse.

The typical revocable living trust and financial durable powers of attorney usually do not contain provisions which address these issues, and issues such as access to assets, access to income and division of trust assets at the death of the first spouse.

Where the situation warrants, the revocable living trust should contain a strong amendment power which is coordinated with language in the financial durable powers of attorney. With these powers in place, the trust can be amended in the future if required, should one of the settlors of the trust become incompetent.

The special language in the financial durable powers of attorney should provide that the family home and other assets can be protected by taking certain actions, should one of the settlers lose capacity and go into a Medi-Cal qualified long term care facility. For instance, through these powers, title to the home and other assets could be transferred to the well spouse, to the children, or to an irrevocable income only trust, as we have discussed in previous issues of this newsletter.

The language in the revocable living trust should also provide that if the well spouse dies first, that the trust assets should not pass to the ill spouse, and thereby by susceptible to attachment by the state for Medi-Cal payments.

In addition, the revocable living trust should contain provisions that provide that if either of the Settlors is living in a skilled nursing facility, that payment of income and principal should not be made to the ill spouse.

Other Probate & Trust Newsletters

Avoiding Probate in California

A Primer on Probate

Funding Your Revocable Living Trust

Can I Have a Trust for My Pet? Yes!

"My Son In Law is a Big Fat Dummy." Remedy: The Personal Asset Trus

Problems With Typical Revocable Living Trusts and Financial Durable powers of Attorney - And the New 70

Long Term Care Provisions for the Revocable Living Trust and Financial Durable Powers of Attorney for Couples Facing an Diagnosis of Early Dementia

The Revocable Living Trust - Preparing for Incapacity


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