Jan
22
2015
0

My Dad Has Already Done Some Gifting! Can He Still Qualify For Medi-Cal?

California does have gifting penalty rules. If the rules are not followed, you could create periods of ineligibility for Medi-Cal. If you follow the rules, Medi-Cal can pay for your stay in a skilled nursing facility, minus a share of the cost that you would pay. We have seen monthly bills of $10,000 and more from skilled nursing facilities.

You can gift any amounts of money or assets to your spouse without penalty, and she can keep up to $119,220, plus her IRAs and “exempt assets, and you can still be qualified for Medi-Cal.

If you gift your money and other non-exempt assets to someone other than your spouse, penalties may apply. The Medi-Cal application asks if you have made any gifts of non-exempt assets to someone besides your spouse, within the last 30 months. If you have, that amount is divided by $7,628. This is the amount that Medi-Cal pays monthly to nursing homes, minus the share of cost paid by the Medi-Cal recipient. It is called the Approximate Private Pay Rate, also known as the APPR.

So for instance, if you gave $40,000 to a grandchild for college tuition during January of 2014, you would not be eligible for for Medi-Cal for the next 5 months. You would not be eligible for the months January through May. You would be eligible however in June, 2014. To figure this out, divide the gifted amount of $40,000 by $7,628 and you will get 5.24, which rounded down is 5 months of ineligibility. You can also give the same amount of a gift on the same day to two children, and still only get 5 months of ineligibility. There are also other rules which can be employed which allow us to transfer monies over time, and thereby significantly reduce the number of months of ineligibility. The nice thing about these rules, as they presently exist, is that the penalty begins to run during the month that you made the gift.

When the Deficit Reduction Act (DRA) is adopted in California, which could be any time, there will be a five year look back instead of a 30 month look back penalty period for gifting. If we take the above example under the DRA rules, of the $40,000 gift to a grandchild, you would be ineligible for 5.24 months after you have entered the nursing home. If you gifted that amount to two people, you would have two periods of ineligibility of 5.24 months each. Also, under the DRA, the more liberal rules for gifting over time will be severely restricted.

As a result, you should proceed now with your long term care planning with your elder law attorney.

For additional information, you can contact your elder law attorney Michael J. Young. This information is not to be taken as legal advice, and you are encouraged to see your elder law attorney. At the law offices of Michael J. Young, 1931 San Miguel Dr., Ste. 220, Walnut Creek, CA http://www.WalnutCreekElderLaw.com, 925-256-0298,lawyoung1@gmail.com, we practice elder law and we help Baby Boomers, Seniors and families through their Elder Care Journey. We help families with “Sustainable Estate Planning” TM, long term care planning, asset protection plans, special needs trusts, comprehensive estate planning, wills, trusts and powers of attorney. We also help Baby Boomers and families get their “Ducks in a Row” in order to help them qualify for Medi-Cal and the VA Aid & Attendance Improved Pension Benefit.

Dec
01
2014
0

More On Alternative Long Term Care Insurance Options for Baby Boomers

In our last post we discussed how many of our Baby Boomer clients have looked into buying long term care insurance, but have decided against the purchase because of various reasons. Some feel that the cost is too high, or they don’t like the idea that if you don’t use it, you lose most of it. Also, some of our clients have been denied coverage because of their age, health issues, or both. Fortunately, there are alternatives to consider for our older clients.

Many of our clients have several hundred thousand dollars in various investments, including savings accounts, mutual funds, annuities and IRAs, in addition to their home. This would appear to be a nice nest egg, but would be depleted quickly if they were in need of 24/7 care. For a single person, the cost of care could conservatively be $90,000 or more per year and twice that for a couple.

One option is to purchase a type of annuity which provides payments for long term care. The initial premium payment for the annuity could create 2 to 3 times the amount of the premium in long term care payments. For example, if you re-position $50,000 into the annuity, then $100,000 to $150,000 could be available for long term care expenses. The underwriting for this type of product is much simpler than applying for long term care insurance, but the age and health of the client is still taken into account.

In addition, under the “Pension Protection Act”, you could withdraw the $50,000 tax free from an existing annuity to purchase an annuity with the long term care payment option. You could also fund the purchase of this new product using IRA money through an income tax free “trustee to trustee transfer.”

When you visit our office, ask us to help you explore the possibility of repositioning a portion of your assets for payment of your long term care should you need it in the future. These options should be explored as part of your long term care asset protection and estate planning.

For additional information, you can contact your elder law attorney Michael J. Young. This information is not to be taken as legal advice, and you are encouraged to see your elder law attorney. At the law offices of Michael J. Young, 1931 San Miguel Dr., Ste. 220, Walnut Creek, CA http://www.WalnutCreekElderLaw.com, 925-256-0298,lawyoung1@gmail.com, we practice elder law and we help Baby Boomers, Seniors and families through their Elder Care Journey. We help families with long term care planning, asset protection plans, special needs trusts, comprehensive estate planning, wills, trusts and powers of attorney. We also help Baby Boomers and families get their “Ducks in a Row” in order to help them qualify for Medi-Cal and the VA Aid & Attendance Improved Pension Benefit.

Sep
29
2014
0

An Interesting Insurance Based Strategy To Help Private Pay For Long Term Care

Our clients are concerned about how they will private pay for their long term care. Most long term care takes place first in our homes and then in assisted living facilities. We have Medi-Cal in California, but it only pays for a stay in a skilled nursing facility, if we qualify. As a result, our clients are always asking, “How can we private pay for our long term are if we do not go into a nursing home?”

This strategy may be appropriate for individuals who do not want to pay premiums to purchase long term care insurance policies. People have become reluctant to purchase long term care insurance because of the cost, and because of the fact that if you do not use it, your investment by way of premiums paid is lost. In addition, long term care insurance companies have been known to raise the premiums of its insureds over time.

Many of our clients take the position that they will “self-insure”, using their savings for their care. For these individuals, one effective planning approach may be to leverage some of their savings that they would use for their care in the future to provide a larger pool of money. This money can be utilized to pay for care in the home, assisted living facility or nursing home. If the money is not needed, it would then pass to their children or heirs.

To employ this strategy, money is transferred from its current location (bank account, older fixed annuity past the penalty period, etc.) into a specially designed life insurance policy with riders that allow accelerated payment of a large portion of the death benefit to the policy owner upon a qualified health event, to help pay for the costs of long term care.

Depending on the age and health status, the lump sum premium paid into this type of life insurance policy may provide a death benefit of double or more that amount. However, if the insured qualifies to begin using the long term care benefits, the insured may receive as much as five times the amount of the original premium. Any monies not used for convalescent care would still pass to the heirs upon the death of the insured.

When your elder law attorney prepares your long term care estate plan, ask him to explore this possibility with you.

For additional information, you can contact your elder law attorney Michael J. Young. This information is not to be taken as legal advice, and you are encouraged to see your elder law attorney. At the law offices of Michael J. Young, 1931 San Miguel Dr., Ste. 220, Walnut Creek, CA http://www.WalnutCreekElderLaw.com, 925-256-0298, lawyoung1@gmail.com, we practice elder law and we help Baby Boomers, Seniors and families through their Elder Care Journey. We help families with long term care planning, asset protection plans, special needs trusts, comprehensive estate planning, wills, trusts and powers of attorney. We also help Baby Boomers and families get their “Ducks in a Row” in order to help them qualify for Medi-Cal and the VA Aid & Attendance Improved Pension Benefit.

Jan
20
2014
0

7 Practical Considerations To Take Into Account When Choosing an Assisted Living Facility

Here are 7 Practical Considerations to take into account when you are choosing an assisted living facility, either for yourself or a loved one. We have developed this list  after having first hand experience with assisted living facilities that my father lived in, and after having interacted with our clients regarding these issues over many years.

  1. Is the facility well regarded in the community? Has it been recommended to you by someone who has had a loved one or friend there?
  2. Would the friends and family members of the resident be able to visit at any time, or are there restrictions in this regard?
  3. Is the facility in close proximity to the hospital and medical offices that the resident may need to visit?
  4. How were you treated by the staff and the administrator when you visited the facility? Did you feel welcome and were you comfortable with the experience?
  5. Were all of your questions answered satisfactorily when you visited the facility? Were you left in doubt or were you confused about any of their answers?
  6. Did you feel that you or your loved one would fit into the community for an extended period of time?
  7. Could you imaging yourself or your loved one living there?

* This information is not to be taken as legal advice, and you are encouraged to see your elder law attorney. At the Law Offices of Michael J. Young, at 1931 San Miguel Dr., Ste. 220, Walnut Creek, CA www.WalnutCreekElderLaw, 925-256-0298, lawyoung1@gmail.com we practice Elder Law and we help Baby Boomers and families through the Elder Care Journey. We help families with long-term care planning, asset-protection plans, comprehensive estate planning, wills, trusts and powers of attorney. We also help Baby Boomers and families get their “Ducks in a Row” in order help them qualify for Medi-Cal and the VA Aid & Attendance Improved Pension benefit.

Jan
10
2014
0

FIVE THINGS BABY BOOMERS AND SENIORS CAN DO TO GAIN PEACE OF MIND FOR SURVIVING THEIR RETIREMENT YEARS

Many Baby Boomers and seniors are concerned about surviving their retirement years. Many have not been able to save adequately, have suffered losses in the stock market, and do not have pension funds sufficient to meet their future needs. Most are concerned about health care issues, and how their nursing home costs would be paid for if needed. They also want to leave a legacy to their loved ones.

First: Update your estate plan to a Long Term Care Plan. Most of our clients do not have long term care insurance to pay for a stay in a nursing home. Fortunately however, California has Medi-Cal, which will pay for a stay in a nursing home provided that you qualify. You can now set up a long term care plan, as part of your estate plan, to provide for asset protection and qualification for Medi-Cal. within the state regulations. For veterans, the plan will also help for qualification for the VA Aid & Attendance Pension Benefit to help pay for in home care and assisted living facilities. Your plan will also confirm your overall desires regarding  how your assets will be spent for your care at home and otherwise.

Second: The home is often our clients’ largest asset. You can take steps now through your estate planning documents to assure that your home will pass to your loved ones as a legacy, without a Medi-Cal lien, so that the state will not be able to recoup any nursing home payments it has made for you.

Third: Change your life style just a little bit, and try to keep more of what your earn. I recommend reading The Millionaire Next Door by Thomas J. Stanley in this regard. Stanley gives examples of how changing your lifestyle somewhat, and giving up certain luxuries, will allow you to put more money into your retirement accounts on an ongoing basis. As you get older, cut back on certain expenditures, and put what you save into your retirement accounts. Go out to fancy dinners less often, put off buying a new car, and put those savings into your retirement account.

 Fourth: We still have Social Security. Some analysts say that the program can pay for benefits for the next 25 years for the general populace. There also seems to be a consensus of opinion, that any changes in the law should not affect Baby Boomers. Although you can begin taking benefits at age 62, this could be a 25% reduction of what you would receive if you waited until you are 66. If you wait until age 70, this could raise your benefit by another 8% per year, so wait longer if possible.

 Fifth: Stay physically active and you will most likely remain healthier and live longer. Try to increase the number of steps you take every day. It has been said that sitting is the new smoking. Get up and walk around for ten minutes every hour. This will also make you more productive. 

* This information is not to be taken as legal advice, and you are encouraged to see your elder law attorney. At the Law Offices of Michael J. Young, at 1931 San Miguel Dr., Ste. 220, Walnut Creek, CA www.WalnutCreekElderLaw, 925-256-0298, lawyoung1@gmail.com we practice Elder Law and we help Baby Boomers and families through the Elder Care Journey. We help families with long-term care planning, asset-protection plans, comprehensive estate planning, wills, trusts and powers of attorney. We also help Baby Boomers and families get their “Ducks in a Row” in order help them qualify for Medi-Cal and the VA Aid & Attendance Improved Pension benefit.

Oct
08
2013
0

What Can The State Recover After I Die?

If you die after having been on Medi-Cal, the State will try to recover from your estate what they have paid out for your benefit. If there is nothing left in your estate, there is nothing for the State to take. If your home is still in your estate when you die, it could be subject to State revocery. Your revocable living trust does not protect your home from State recovery.  If you transferred your home prior to your death, following the Medi-Cal regulations, it would not be subject to recovery by the State upon your death.  If you transferred your home and reserved an irrevocable life estate, the home would not be in your estate when you die, and not subject to recovery. The life estate would disappear upon your death, and the State does not pursue recovery against reserved irrevocable life estates.

The State will not pursue recovery against the surviving spouse of a deceased Medi-Cal beneficiary. After the surviving spouse dies however, the State can pursue recovery against any property received by the surviving spouse through distribution or survival from the Medi-Cal beneficiary spouse.

If the Medi-Cal recipient is survived by a minor child under the age of 21, or if there is a blind or disabled child of any age who survives the Medi-Cal beneficiary, there can be no claim for recoupment by the State.

This information is not to be taken as legal advice, and you are encouraged to see your elder law attorney. At the Law Offices of Michael J. Young, at 1931 San Miguel Dr., Ste. 220, Walnut Creek, CA www.WalnutCreekElderLaw, 925-256-0298, lawyoung1@gmail.com we practice Elder Law and we help Baby Boomers and families through the Elder Care Journey. We help families with long-term care planning, asset-protection plans, comprehensive estate planning, wills, trusts and powers of attorney. We also help Baby Boomers and families get their “Ducks in a Row” in order help them qualify for Medi-Cal and the VA Aid & Attendance Improved Pension benefit.

Jul
19
2013
0

Baby Boomers Predict The Future!

Baby Boomers Predict The Future!

Wouldn’t it be nice to be able to predict the future for us Baby Boomers, and start planning for it! But we do know certain things about our future …

  •  On average, 10,000 people are turning age 65 every day.
  • It is predicted that at least 70% of people over age 65 will need long-term care services.
  • Currently, the median cost of long-term care for one year in the United States is $83,950.00.
  • In 30 years, when the last of the Boomers reach age 65, the price of long-term care is expected to be at an all time high of $190,000 per year.
  • Currently, the average amount of time a person needs long term care is 2.7 years.

 As my grandson would say, “OMG!”

As a senior estate planning attorney, and a Baby Boomer, we need to ask ourselves what we can do to plan for our long term care. GE Long Term Care Insurance conducted a study and found that nursing home costs are rising at a rate of 5% every year, outpacing inflation. With the rapidly growing elderly population this is the simple law of supply and demand.

 So, what can we do to prepare for the second half of life? If you or your spouse are age 65 and one of you goes into a nursing home, do you have a spare $513,000 lying around to pay for your or your spouse’s care.

 We still have Medi-Cal in California, which pays for the cost of a skilled nursing facility. The VA Aid & Attendance Pension benefit is still available to help pay for in home care and assisted living facility costs.

But you need to “get your ducks in a row” ahead of time to plan for qualification for these benefits. For starters, Baby Boomers are now taking advantage of modern asset protection and government benefits planning qualification techniques, which are incorporated into their estate planning documents. Also, one of our main goals is to preserve our homes for our children, without a lien for payback to Medi-Cal. With the modern language in your estate planning documents, if you become incapacitated, your spouse or loved one can follow through with qualification and asset protection techniques under the Medi-Cal and VA regulations.  

This information is not to be taken as legal advice, and you are encouraged to see your senior estate planning attorney before attempting any of these techniques. 

At the Law Offices of Michael J. Young, at 1931 San Miguel Dr., Ste. 220, Walnut Creek, CA www.WalnutCreekElderLaw, 925-256-0298, lawyoung1@gmail.com we practice Elder Law and we help Baby Boomers and families through the Elder Care Journey. We help families with long-term care planning, asset-protection plans, comprehensive estate planning, wills, trusts and powers of attorney. We also help Baby Boomers and families get their “Ducks in a Row” in order help them qualify for Medi-Cal and the VA Aid & Attendance Improved Pension benefit.

Jul
01
2013
0

VA Aid & Attendance 2013 Pension Benefit Amounts

The 2013 Maximum Aid & Attendance Pension Benefit Rates are set forth below. This is a wonderful benefit for older wartime veterans, which can help pay for the cost of in-home care, assisted living facilities and board and care. The benefit is “non service connected”, which means that qualification is not dependent upon a wartime injury.

The veteran must typically have served ninety days of active duty, one day of which was during an offical wartime period. The veteran cannot have had a dishonorable discharge. The veteran’s physician must declare the veteran as in need of assistance from another individual and in need of a “Protective Environment”, which may include services offered by a care facility or company.

You should discuss with your elder law attorney how to make the A&A Pension Benefit part of your long term care planning.

BENEFIT AMOUNTS:

Single Veteran         $1,732.00 Per Month or $20,795.00 Per Year

Married Veteran      $2,054.00 Per Month of $24,652.00 Per Year

Surviving Spouse $1,113.00 Per Month or $32,114.00 Per Year

Veteran Married to Veteran (Both A & A) $2,676.00 Per Month or $32,114.00 Per Year.

At the Law Offices of Michael J. Young, at 1931 San Miguel Dr., Ste. 220, Walnut Creek, CA www.WalnutCreekElderLaw, 925-256-0298, lawyoung1@gmail.com we practice Elder Law and we help families through the Elder Care Journey. We help families with long-term care planning, asset-protection plans, comprehensive estate planning, wills, trusts and powers of attorney. We also help families get their “Ducks in a Row” in order help them qualify for Medi-Cal and the VA Aid & Attendance Improved Pension benefit. This information is not to be taken as legal advice, and you are encouraged to see your elder law attorney regarding any planning.

Jun
10
2013
0

2013 CA Medi-Cal Quick Reference Guide

The State of California has changed some of the Medi-Cal qualification figures and requirements for 2013. A brief listing of these changes and requirements is set forth below:

2013 CA Medi-Cal Quick Reference Guide

Community Spouse Resource Allowance

$115,920

This is the amount that the community, or (at home) well spouse can retain in liquid assets. This amount does not include exempt assets, such as the home and qualified accounts, such as IRA’s.

Minimum Monthly Maintenance Needs Allowance

$2,898

This is the minimum amount of income the well spouse can keep. 

Average Private Pay Rate (Divestment Penalty Divisor)

$7,549

This is the amount the State pays to nursing homes on the Medi-Cal program, minus a share of cost by the applicant. This figure is also used to calculate penalty periods of ineligibility for Medi-Cal.

Applicant Resource Allowance

$2,000

The applicant can keep this amount in cash, checking, etc.

Monthly Personal Needs Allowance

$35

The amount of income the ill person is allowed to keep.

At the Law Offices of Michael J. Young, at 1931 San Miguel Dr., Ste. 220, Walnut Creek, CA www.WalnutCreekElderLaw, 925-256-0298, lawyoung1@gmail.com we practice Elder Law and we help families through the Elder Care Journey. We help families with long-term care planning, asset-protection plans, comprehensive estate planning, wills, trusts and powers of attorney. We also help families get their “Ducks in a Row” in order help them qualify for Medi-Cal and the VA Aid & Attendance Improved Pension benefit. This information is not to be taken as legal advice, and you are encouraged to see your elder law attorney regarding any planning.

Mar
18
2013
0

Getting Your Ducks In A Row Before a Crisis Occurs

You should get your ducks in a row long before a crisis occurs, especially where your health and finances are concerned. Many of our clients come to see us when a crisis is occurring. For instance, their spouse or loved one is in the hospital or has just entered a skilled nursing facility. At this stage the planning is usually more difficult, and we may be facing memory issues of the ill person. It may also be more difficult to preserve the home as a legacy for the clients’ beneficiaries. The home is many times our clients’ largest asset.

As part of long term care planning, we plan how various stages of care will be paid for and determine what assets and resources are available. We proceed to get our ducks in a row to protect assets. We also line our ducks up for obtaining Medi-Cal to pay for the skilled nursing facility and the VA Aid & Attendance Pension Benefit to pay for in home care or an assisted living facility. Gifting and spending issues for Medi-Cal and VA are considered. The longer we have to do long term care planning, the easier it is for all concerned. In addition, your peace of mind can be assured earlier on. 

FAMILY DYNAMICS: When we are able to do pre-planning for our clients, we can better take into account issues concerning family dynamics. We need to know which family members are helping the ill person, and who can be relied upon when help is needed. We can offer suggestions for the well spouse for her care for the ill spouse when he comes home. We will be better able to find out if there is serious infighting and resentments among family members. When a crisis occurs, these dynamics become intensified.

LEGAL DOCUMENTS: Are the legal documents up to date? If they are, you are in a tiny minority. If you have not gone to an elder law attorney in the last several years, your documents are probably not up to date. There is specialized language that can be utilized for asset protection and for government benefits planning in the various documents. For instance, if we want to preserve the home and protect it from a Medi-Cal lien, and the ill person has severe memory issues, we may not be able to proceed to transfer the home to the well spouse or a child without going to court. Most revocable living trusts and financial durable powers of attorney do not contain this specialized asset protection language.

Pre-planning will also allow us to discuss any changes that may be needed in the trust, will, financial durable power of attorney and other estate planning documents. Family dynamics are always changing with the occurrence of deaths, divorces, children who are themselves in need of care, second marriages, etc.

Written Michael J. Young, elder law attorney, Medi-Cal attorney, senior law attorney and probate attorney in Walnut Creek, CA and former in-house counsel for title insurance companies. Mr. Young is a Medi-Cal attorney and is VA Certified.  www.WalnutCreekElderLaw.com LawYoung1@Gmail.com 1931 San Miguel Dr., Suite 220, Walnut Creek, CA 94596. 925-256-0298. Mr. Young serves Contra Costa and Alameda Counties, including the cities of Walnut Creek, Alamo, Danville, Concord, Brentwood, Pleasant Hill, Antioch, Clayton, etc. Mr. Young advises clients regarding Probates, Probates with Real Estate, Medi-Cal, nursing homes, asset protection, the VA Aid and attendance pension benefit, and long term care planning. Mr. Young is an Elder Law Attorney and Probate Attorney with offices in Walnut Creek, CA. Walnut Creek Elder Law Attorney, Walnut Creek Probate Attorney. Senior Law Attorney

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