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By Attorney Rick Law, managing partner at the Estate Planning Center at Law Elder Law. Providing estate planning, wills trusts, probate, guardianship, and elder law services to the western Chicago suburb of Aurora in Kane County, Illinois. Let’s say a couple has a house that is valued at approximately $300,000 and two vehicles.  One spouse needs nursing home care and applies for Medicaid assistance. In Illinois, if one spouse stays at home (the “community” spouse), the home is considered “exempt”.  The community spouse can have one vehicle of any value and the institutionalized spouse can have a vehicle as long as the value is not more than $4,500 (unless it is a special vehicle for transportation due to medical needs—i.e., a wheelchair van). So, in this instance, their house and cars are exempt. In addition to the house and the cars, let’s say they have a joint annuity of $100,000, a couple of CDs of $20,000 each, a brokerage account of $50,000, and a checking and savings account of about $15,000 total. In Illinois, the community spouse can keep $109,560 and the institutionalized spouse can have a maximum amount of assets of $2,000, for a total of $111,560. Anything over the $111,560, regardless of the type of asset (even IRAs), must be spent down on care before the in prior to qualifying for Medicaid for the institutionalized spouse. If you’re ready to start getting your estate in order and secure your assets for the “worst-case” scenario, please give our office a call at 800-310-3100. Your first consultation is absolutely free.  We’ll let you know what steps you need to take, right now, to protect yourself and your family.  Call now. Sincerely, Rick L. Law, Attorney, Estate Planner for Retirees. Rick was named the #1 Illinois elder law estate planning attorney by Leading Lawyer Magazine. He has been quoted in the Wall Street Journal, AARP Magazine, TheStreet.com, and numerous newspapers and articles. Rick is the lead attorney for Law Elder Law, LLP, focusing in Estate Planning, Guardianship, and Nursing Home Solutions. His goal is to give retirees an informed edge when it comes to dealing with an uncertain future.  Get flexible retirement strategies that work during good times and bad, plus information on how you can save your home and assets from being used to pay for long term care.  Call 800-310-3100 for your free consultation now!
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By Rick Law of the Estate Planning Center at Law Elder Law in Aurora, IL.  Senior advocates, estate planners, and elder lawyers. Individuals with more assets than allowed by Medicaid must “pay down” or “spend down” their assets before they can qualify to be eligible for Medicaid benefits. If someone applies for Medicaid before “spending down” to the allowable assets, some states will deny the application and others will place the applicant in a “spend down”.  The “spend down” requires that all assets over the allowable amount be spent on care before eligibility is triggered. Although that might seem harmless, it is not! This is an email that the I received from a client: “I don’t know if you can help me. My mom doesn’t have a lot of assets. She owns a home and she has about $42,000 of assets. She went into the hospital but she wasn’t there long enough before she was transferred to a skilled nursing facility for nursing home rehab.” Typically that person is going either to long-term care or skilled rehab. The basic rule is that the person has to have three midnights as an inpatient in a hospital to trigger Medicare paying for a skilled-nursing facility post-hospital stay. What’s happening now is that the centers for Medicare or Medicaid services have hired recovery audit contractors, who are independent contractors who get paid a lot of money to deny care, in order to save money for Medicare. Right now the recovery audit contractors are disallowing about 90 percent of one- to two-day stays in the hospital. In order to get to a skilled-nursing care facility, a person has to have a stay of three nights, or three midnights, to trigger the skilled-nursing care facility coverage that follows up. So the client is saying her mother was on her own dime in the hospital. Now she’s on her own dime in a skilled-nursing facility. They don’t know what’s going to happen next and don’t know what they should do. The nursing home may have even volunteered to work with the family to submit the Medicaid application. If they provide the asset information and she is approved for a spend down, the remaining $42,000 plus any sale proceeds from the home (in states where the home will not remain exempt) MUST be spent on care. What if she has not yet paid for her funeral? What if she has some credit card debt? What about the ongoing expenses related to the home? What if the real estate taxes come due next month? See, not as harmless as one might think. Under the Deficit Reduction Act, if she made any “non-allowable transfers” in the past five years, the transfers would be totaled and a penalty assessed, and that penalty will not start to run until she is “otherwise eligible,” which means not until she has completed her spend down—then the penalty period will begin, and she won’t get benefits until it ends. Too many families needlessly lose everything they have.  Don’t let that be you.  If you need help paying the overwhelming cost of long term care, give our office a call at 800-310-3100.  Your first consultation is absolutely free.  We’ll let you know what steps you need to take, right now, to protect yourself and your family.  Call now, because when you’re out of money, you’re out of options! Sincerely, Rick L. Law, Attorney, Estate Planner for Retirees. Rick was named the #1 Illinois elder law estate planning attorney by Leading Lawyer Magazine. He has been quoted in the Wall Street Journal, AARP Magazine, TheStreet.com, and numerous newspapers and articles. Rick is the lead attorney for Law Elder Law, LLP, focusing in Estate Planning, Guardianship, and Nursing Home Solutions. His goal is to give retirees an informed edge when it comes to dealing with an uncertain future.  Get flexible retirement strategies that work during good times and bad, plus information on how you can save your home and assets from being used to pay for long term care.  Call 800-310-3100 for your free consultation now!
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By Estate Planning Attorney Rick Law, at the Estate Planning Center of Law Elder Law in Aurora, IL. When it comes to prenuptial or antenuptial agreements, if one spouse has to go to a nursing home, both spouses are responsible to pay for the care. That means your prenuptial or antenuptial agreement may not be worth the paper it is written on! When one spouse needs nursing home services (the “institutionalized” spouse) and applies for help from the state through the Medicaid program, there also is a limit on income for spouse who is still living at home (the “community” spouse) For example, the “minimum monthly marital needs allowance” (MMMNA) in Illinois is $2,739 per month. The best way to describe the MMMNA is that the state of Illinois does two levels of testing to determine whether or not there would be some sort of diversion of the institutionalized spouse’s income to the healthy community spouse. Here’s a pair examples to illustrate this point. MMMNA Example No. 1: The husband has a Social Security check of $1,200 per month and a pension of $1,200 a month. The wife has a Social Security check of $600 a month. So, the husband is getting $2,400 a month. The only income that’s coming to the wife in her name is the $600 social security check. Now, the husband needs to apply for Medicaid nursing home benefits because he has Alzheimer’s. In Illinois, the only amount of money he can keep to spend on himself is $30 per month, as a personal-needs allowance. The only other deduction allowed from the husband’s income is his supplemental insurance payment. If the husband pays $220 for his Medicare supplement there is $2,150 left from his $2,400 income. In Illinois, the MMMNA is $2,739. What does that mean? The wife has only $600 income of her own, so $2,139 can be diverted to the wife from what is remaining of her husband’s income. The remaining $19 must be paid to the nursing home each month. The wife must continue paying the electric, gas bill, and grocery bill; auto gas, insurance, and maintenance; house maintenance, insurance, and taxes (hopefully not a mortgage payment); her own health insurance supplement, doctor, and pharmacy bills; and her own personal everyday needs on $2,739 per month. When the husband dies, she will lose her $600 and probably all or half of his pension. She will go from receiving $2,739 a month down to $1,200 or $1,800 a month. Now, by changing a few numbers, we can illustrate how harsh the MMMNA can be for individuals that are used to a slightly different lifestyle. MMMNA Example No. 2—Drastic Lifestyle Alteration: In this example, the community spouse still has her $600 Social Security check from working at a bank for a few years, but she became a teacher later in life and is now a retired teacher. She has a small income, but she actually wound up having a very large teacher’s pension and is getting $2,100 a month for her pension. Her husband is also a retired teacher and he was a principal and has $4,000 a month for his teacher pension. The income in his name is $4,000. The income in the wife’s name is $2,700.  When the husband applies for Medicaid assistance, he only gets to keep $30 for the personal-needs allowance. His teacher pension provides his insurance, so there’s no deduction for a Medicare supplement. Because the wife’s income is $2,100 per month and she’s only allowed $2739,  she will only get to keep $39 per month of her husband’s income. What happens to the rest of his money every month?  It must be paid to the nursing home. Here we have a wife who was used to living on $6,700 a month for two people, and now she’s down to $2,739. That’s quite a change.  She still has to pay for electric, gas, groceries, insurance, maintenance, real estate taxes, her own health insurance, doctor and pharmacy bills, and her own personal needs. These examples illustrate why people who think that Medicaid is only for poor people need to rethink that idea. Too many families needlessly lose everything they have.  Don’t let that be you.  If you need help building a fortress around your estate to protect it from creditors, predators, and the cost of chronic disease, give our office a call at 800-310-3100.  Your first consultation is absolutely free.  We’ll let you know what steps you need to take, right now, to protect yourself and your family.  Call now, because when you’re out of money, you’re out of options! Sincerely, Rick L. Law, Attorney, Estate Planner for Retirees. Rick was named the #1 Illinois elder law estate planning attorney by Leading Lawyer Magazine. He has been quoted in the Wall Street Journal, AARP Magazine, TheStreet.com, and numerous newspapers and articles. Rick is the lead attorney for Law Elder Law, LLP, focusing in Estate Planning, Guardianship, and Nursing Home Solutions. His goal is to give retirees an informed edge when it comes to dealing with an uncertain future.  Get flexible retirement strategies that work during good times and bad, plus information on how you can save your home and assets from being used to pay for long term care.  Call 800-310-3100 for your free consultation now!
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By Rick Law, Managing Partner and Senior Advocate at the Estate Planning Center of Law Elder Law in Aurora, IL in the Western suburbs of Chicagoland. When one spouse is in a nursing home (the “institutionalized” spouse), and one spouse still lives in their jointly owned home (the “community” spouse), the home is considered an exempt asset.  In other words, the spouse still living in the home does not have to sell the home for the ill spouse to qualify for Medicaid assistance. But, there are different  rules in each state regarding liens placed against the home. In some states, even though the home is “exempt,” the state stands ready to file a lien against the home at the time the community spouse passes away for the amount paid for assistance of the institutionalized spouse. When a single person moves out of their home to go to a nursing home, the rules change. In most states, the individual in the nursing home is not allowed to keep their home. In some states, if the person does keep the home, the state will file a lien against that home. In Illinois, the state files a lien, but if the person is able to move back home, a lawyer can have the lien removed. Most states have certain limitations, ranging from $750,000 to $5 million of equity, on the maximum amount of equity that a person can have in a home or be forced to sell it. In many states, including Illinois, if a single person owns a home and goes into a nursing home, it is presumed that person will not go back to their home. Therefore, the state will require that the home be listed for sale if the owner has not returned to the home after 120 days. The owner can claim what is called an “intent to return” and not have to sell the home, but the state of Illinois will file a lien against the house.  The lien is based on whatever is the eventual total amount of Medicaid that is expended on that person’s behalf, so that when that house is sold, the state has a claim against the proceeds. The federal government allows the states to choose levels of exempt assets within a range of what’s allowable under the federal standards. These exempt assets, called the “community spouse resource allowance” (CSRA), is the amount of money available to a community spouse as a resource allowance when an institutionalized spouse applies for benefits under the Medicaid program. Most states require full disclosure of all assets owned jointly or individually by either spouse. Illinois and many other states do not care if this is a second marriage or if there is a prenuptial agreement.  All assets must be disclosed when either spouse applies for Medicaid assistance. Too many families needlessly lose everything they have.  Don’t let that be you.  If you need help paying the overwhelming cost of long term care, give our office a call at 800-310-3100.  Your first consultation is absolutely free.  We’ll let you know what steps you need to take, right now, to protect yourself and your family.  Call now, because when you’re out of money, you’re out of options! Sincerely, Rick L. Law, Attorney, Estate Planner for Retirees. Rick was named the #1 Illinois elder law estate planning attorney by Leading Lawyer Magazine. He has been quoted in the Wall Street Journal, AARP Magazine, TheStreet.com, and numerous newspapers and articles. Rick is the lead attorney for Law Elder Law, LLP, focusing in Estate Planning, Guardianship, and Nursing Home Solutions. His goal is to give retirees an informed edge when it comes to dealing with an uncertain future.  Get flexible retirement strategies that work during good times and bad, plus information on how you can save your home and assets from being used to pay for long term care.  Call 800-310-3100 for your free consultation now!
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By Elder Law attorney Rick Law. Founder and Managing partner at the Estate Planning Center at Law Elder Law.  Senior care and planning advocates in Aurora, IL, just off the Farnsworth exit of the I-88 tollway. Medicaid eligibility is based on the applicant’s medical condition and assets and income. For example, to apply for Medicaid assistance to cover residential long-term-care costs, an individual must either live in a nursing home or have a medical need (such as Alzheimer’s) that requires nursing home care. A medical assessment is necessary to establish medical eligibility in order to identify the long-term health-care needs. It is also necessary to be a U.S. citizen or be lawfully admitted for permanent residence in the United States. Individuals are required to live in the state where they apply for Medicaid and must intend to make that state their home. Medicaid strictly limits the assets people may own while accepting benefits. While each state has its own limits and its own exempt assets, the following are generally exempt assets that do not count against the beneficiary:
  • the principal place of residence in certain situations
  • household and personal belongings
  • one car
  • burial plot/prepaid funeral plan
  • cash value of permanent life insurance policies up to $1,500
  • a small amount of cash (this varies from state to state, but typically a single Medicaid applicant may keep $2,000 while married couples who both require Medicaid may keep about $3,000)
All other assets are “countable assets” and count toward the state determined maximum. Countable assets are bank accounts, CDs, money market accounts, stocks, mutual funds, bonds, retirement accounts, pensions, second cars, second or vacation homes, and any other item that can be valued and turned into cash. Too many families needlessly lose everything they have.  Don’t let that be you.  If you need help paying the overwhelming cost of long term care, give our office a call at 800-310-3100.  Your first consultation is absolutely free.  We’ll let you know what steps you need to take, right now, to protect yourself and your family.  Call now, because when you’re out of money, you’re out of options! Sincerely, Rick L. Law, Attorney, Estate Planner for Retirees. Rick was named the #1 Illinois elder law estate planning attorney by Leading Lawyer Magazine. He has been quoted in the Wall Street Journal, AARP Magazine, TheStreet.com, and numerous newspapers and articles. Rick is the lead attorney for Law Elder Law, LLP, focusing in Estate Planning, Guardianship, and Nursing Home Solutions. His goal is to give retirees an informed edge when it comes to dealing with an uncertain future.  Get flexible retirement strategies that work during good times and bad, plus information on how you can save your home and assets from being used to pay for long term care.  Call 800-310-3100 for your free consultation now!
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By Rick Law, Medicaid crisis planning attorney and estate planner at the Elder Law firm of Law Elder Law in Western Chicagoland in IL. An often overlooked aspect of Alzheimer’s disease is the burden placed on caregiving spouses, who often need care themselves later. We once had a client whose husband had Alzheimer’s disease and eventually needed long-term care beyond what his wife could provide. Despite the husband’s macho declaration that he would put a gun to his head before ever going to a nursing home, the sad truth is that his wife would be the one to bear the burden caused by his long-term-care needs and her own aging challenges. The husband and wife in this example are frugal people who worked hard all their lives. They live on two Social Security checks, his modest pension, and minimal investments. They are able to pay their bills and enjoy simple luxuries—until the out-of-pocket expenses of long-term care begin to drain what they worked a lifetime to save. The wife selflessly provides in-home care for her beloved husband, but eventually the day will come when her strength is not enough to pick him up or keep him from wandering away from home. On that day, it might be a doctor, a discharge planner, or a police officer who looks into her eyes and speaks the harsh truth: “I’m sorry, ma’am. You can’t take care of him by yourself anymore.” This poor woman will then face a nightmare as she walks the eldercare journey with a frail and declining husband. First, she will learn that neither Medicare nor their health insurance provides any payment for home healthcare costs. Later, when her husband must be relocated to a long-term care facility, she will discover that neither Medicare nor Medicaid supplemental insurance will pay the facility’s $3,000 to $8,000 monthly cost. Quickly, she also will discover that Medicaid is not available because she has “too much money.” Her husband’s care will be offset by Medicaid only if she and her husband meet stringent income and asset limitations. If they have assets over $109,560, they will be forced to “spend down” their life savings, which Medicaid defines as “excess assets.” When all excess assets have been spent on her husband’s medical care, then Medicaid will also control her monthly income. In Illinois, she will be restricted to $2,739 per month from the couple’s joint income. If she has more income than this of her own not counting her husband’s income, the state (again, Illinois) will seek a support amount from her to contribute to the payment of his care. Later, when her husband dies, she will receive more bad news. She may lose all or half of his pension, and as the “survivor spouse” she loses one of the two Social Security checks. She has spent nearly all of their assets to provide for her husband’s care, and now she can’t even afford to live in her own home. The nightmare of long-term care will leave her impoverished and will steal her independence after she has spent many years providing for his care. She will not have the luxury of a spouse who will serve her as she served him. No one will be there to dutifully care for her at home and to delay the day that she must move to a long-term-care facility. She will not have the financial resources that he had, because Medicaid called them “excess nonexempt assets” and she spent those assets paying for her husband’s care. As a single person, she will not be provided with assistance by the Medicaid system until she has become impoverished to the point of a paltry $2,000 or less in total assets. The indignity committed against her does not stop there, for now she must sign over all her income to the nursing home as well, except for a miserly personal-needs allowance of $30 per month, which is not enough to get her hair done much less to pay for personal items and replace clothing that is worn or that does not come back from the laundry at the nursing home. The loving wife who faithfully cared for her husband is now out of money and out of options. She is alone—and living the nightmare of long-term care in America. Too many families needlessly lose everything they have.  Don’t let that be you.  If you need help paying the overwhelming cost of long term care, give our office a call at 800-310-3100.  Your first consultation is absolutely free.  We’ll let you know what steps you need to take, right now, to protect yourself and your family.  Call now, because when you’re out of money, you’re out of options! Sincerely, Rick L. Law, Attorney, Estate Planner for Retirees. Rick was named the #1 Illinois elder law estate planning attorney by Leading Lawyer Magazine. He has been quoted in the Wall Street Journal, AARP Magazine, TheStreet.com, and numerous newspapers and articles. Rick is the lead attorney for Law Elder Law, LLP, focusing in Estate Planning, Guardianship, and Nursing Home Solutions. His goal is to give retirees an informed edge when it comes to dealing with an uncertain future.  Get flexible retirement strategies that work during good times and bad, plus information on how you can save your home and assets from being used to pay for long term care.  Call 800-310-3100 for your free consultation now!
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