We all age, and, at some point, it becomes necessary to focus attention on our future health, medical care and how to pay for long-term residence in a nursing facility or other institution. It pays to seek estate planning services in Massachusetts when planning for such future expenses, as the basic cost of residence in a nursing facility can quickly add up to six figures each year. A small percentage of people may be able to qualify for long-term care insurance and then afford the premiums for it, but most cannot.
MassHealth Long-Term Care may be the answer. Consultation with your Mattapoisett attorney can be critical. More harm than good can be done by completing and submitting a MassHealth Long-Term Care Application without knowing the MassHealth regulations and understanding how they apply to you, or your loved one. Sitting down in a South Coast law office to review your assets, your income, family dynamic and current estate plan, if any, is highly recommended.
When you submit your application, MassHealth will be interested not only in your current assets, but what you did with your property and assets in the 5 years prior to your application. If your countable assets (e.g., IRA, bank account, cash value of life insurance, beneficial interest in a trust, 401(k), certificate of deposit) exceed $2,000 in value, you will be denied benefits until you spend the assets down to $2,000 or less. And, if you gifted any money in the last 5 years, MassHealth will likely disqualify you from receiving benefits now for a period of time, which time period will be determined by a calculation involving the value of the gift or gifts that were made. But, if you consult your Mattapoisett attorney, you may learn there is one or more estate planning strategies that can be used to preserve assets for the family, avoid disqualification, and help qualify you for long-term care benefits sooner than you anticipated. The benefit of seeking estate planning services in Massachusetts cannot be underestimated.
What is MassHealth Long-Term Care?
Medicaid is referred to as MassHealth in the Commonwealth of Massachusetts. Long-term care is residence and care in a nursing facility or institution for more than six (6) months. A recipient of MassHealth long-term care must use most of his/her income (e.g., social security, pension) to pay the nursing facility. The portion paid by the long-term care resident is called the patient paid amount, or PPA. MassHealth pays the remainder nursing facility charge, but at a greatly reduced rate—reduced in relation to the “private pay rate” charged by the facility.
Qualifying for MassHealth Long-Term Care
Eligibility for MassHealth Long-Term Care is based on the total value of all of the applicant’s countable assets. Income is not, for all intents and purposes, relevant to eligibility for long-term care benefits. Whether your primary residence is in Mattapoisett, Rochester, Marion, Fairhaven, New Bedford, Dartmouth, Plymouth, Taunton or elsewhere in Massachusetts, is of no import in the process. If you own your principal residence, however, it may be deemed a non-countable asset for purposes of determining your eligibility; that is, if your assets exceeded the permitted $2,000 limit. On the other hand, holding a life estate in that principal residence or having the real estate held in a revocable trust, changes how MassHealth views the property and, under the MassHealth Regulations, real estate so held—even a principal residence—can be deemed a countable asset and result in denial of the application for long-term care. Working with a South Coast law office that has experience with long-term care and other financial planning services can mean the difference between qualifying for MassHealth Long-Term Care or being rejected outright.
MassHealth Long-Term Care is not just for singles. South Coast couples often come to a fork in the road and one of them needs to make a permanent move to a nursing facility. It is in this context that the terms “institutionalized spouse” and “community spouse” are used. All assets of a couple are considered when the MassHealth Long-Term Care application is submitted for the institutionalized spouse. This includes assets owned jointly by the couple and assets only in the institutionalized spouse’s name, as well as assets only in the community spouse’s name. In 2015, at the application stage, the couple is permitted $121,220 of combined countable assets. Upon approval of the institutionalized spouse’s application, the couple is given a limited amount of time in which to remove the institutionalized spouse’s name from all but $2,000 of those combined assets. Your Mattapoisett attorney can help you. Under the MassHealth Regulations, there is no penalty for transferring assets from one spouse to the other. Deeds and similar legal documents may need to be prepared and publicly recorded and/or filed, but, by making use of the available estate planning services in Massachusetts, such transfer tasks should be relatively painless.
When you look for estate planning services in Massachusetts, keep in mind that, like the law, your life—work, savings, family—are ever-changing and will require you to periodically re-visit your estate plan and estate planning documents to be sure that they still accomplish your goals. While that simple will, durable power of attorney, health care proxy, and trust may have been just what you needed 15 years ago, they may be out-of-date with the law and ineffective currently, or, more disturbingly, an obstacle in the path to attaining your current goals. See your South Coast lawyer; see your Mattapoisett attorney.