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I'm not going to shield my assets. I intend to spend my savings for my wife and myself. We want that big private room down at the end of the nursing home, you know, its the one that Medicaid won't cover.
Any body visited a nursing home lately to see someone staying there courtesy of Medicaid?
I'm using any assets I have for at-home care. Posh or not, nursing home is not for me. I would cause too much trouble and get kicked out.
I guess we can argue over whether its immoral. As an attorney, I know people who have successfully done it by creating an irrevocable trust, years in advance of their incapacity or ill health.
There are risks you take when you do it. The creation of such a trust requires giving control of your assets to children or another third party. That third party may act wisely or they may not. You may need the assets and not be able to get access to them. There are plenty of risks involved in such an arrangement. I think, generally speaking, the risks aren't worth it. However, some will still try to do this anyway. Some will get burned in the process too.
I shouldn't do it. But a little chuckle sometimes escapes my lips when I learn of a situation where the assets were stolen by children or lost through some other mechanism. There is an expression in life that says: Don't outsmart yourself.
Its exactly what these people did when they put their assets in an irrevocable trust and gave up any control of them.
Well said.
To impoverish yourself so you qualify for Medicaid - you give up control of your money. Period. And all manner of things can happen. Perhaps that child you think is great and responsible goes through a nasty divorce - or is involved in an expensive lawsuit? And poof - your money is gone.
Also - a lot of discussions like this assume that there is and always will be a one tier medical care system - and that people on Medicaid will get the same LTC as those who pay. Not true now IMO - and increasingly less true IMO in future decades.
FWIW - neither of my recent estate planning lawyers gets involved in this kind of stuff. They were/are doing very well without having to get involved in things they didn't like. Robyn
I don't understand how Medicaid works so I'm new to all this. I've read that there's a 5-year look-back period with disposing of assets. What I don't understand yet is whether Medicare (which I'm not on yet) pays for SNF/nursing home. But reading the two scenarios between family A and family B is really an eye-opener in terms of this issue. Why should Medicaid readily help family B? And the larger issue of course of how this is going to be sustained economically with the enormous wave of boomers and the unbelievable cost of care.
I'm not familiar with the exact current look-back periods - or exactly how they work. Because no one in my very immediate family is or is planning to do anything like this (one family member did it in the past and I thought the whole scenario was stupid).
Medicare pays for some very limited SNF care. Basically post-hospital rehab care. It's limited in terms of the circumstances under which you can get it - and how long you can get it. A common example would be a max of X days after a stroke for rehab only (once you reach maximum medical improvement - or your maximum number of days - Medicare stops paying).
I honestly don't see why anyone would do this or anything like this. Except perhaps in circumstances involving spouses and certain state/federal rules regarding assets. When one is dealing with spouses - I think we should have a system where the "well spouse" should be able to keep something/everything (subject to some reasonable middle class limits) until both spouses are dead and not have to impoverish himself or herself to pay for the "sick spouse". And - when both spouses are dead - the government should be entitled to full reimbursement before any kids or similar get an inheritance. There are some very sticky issues even when you're dealing with spouses today under current rules. I've read about "strategic divorces" between older spouses so one spouse doesn't wind up impoverishing himself or herself while spending down assets to care for the other.
If I were "Queen For A Day" - all spouses of somewhat limited means (maybe less than $1 million in assets?) would be protected until both were dead. And the government would be paid for whatever care it had paid for before anyone else. Perhaps some people like their kids or their cats better than their spouses - but I think spouses are entitled to preferential treatment. Call me old-fashioned. Robyn
Another consideration here, as yet unmentioned in this thread, is that not everyone is going to need nursing care before they die anyway. Some of us will drop dead of a heart attack, or die in our sleep, while we are still able to more or less care for ourselves. In fact, that is not unusual!
So a couple, or an individual, could shelter their assets, lose them all to a child or children in whom trust was misplaced, then die impoverished without ever needing nursing care! That would be a hell of an irony.
Another consideration here, as yet unmentioned in this thread, is that not everyone is going to need nursing care before they die anyway. Some of us will drop dead of a heart attack, or die in our sleep, while we are still able to more or less care for ourselves. In fact, that is not unusual!
So a couple, or an individual, could shelter their assets, lose them all to a child or children in whom trust was misplaced, then die impoverished without ever needing nursing care! That would be a hell of an irony.
I haven't thought about this issue but as we age it's coming more to the forefront. This article provides a lot of food for thought, looking forward to your responses.
I don't understand how Medicaid works so I'm new to all this. I've read that there's a 5-year look-back period with disposing of assets. What I don't understand yet is whether Medicare (which I'm not on yet) pays for SNF/nursing home. But reading the two scenarios between family A and family B is really an eye-opener in terms of this issue. Why should Medicaid readily help family B? And the larger issue of course of how this is going to be sustained economically with the enormous wave of boomers and the unbelievable cost of care.
No Medicare does not pay for SNF or nursing home care....except for maybe 90 days after a hospital admisssion...you may well want to look into this...
Shielding assests so Medicaid foots the bill is..in my opinion..wrong wrong wrong...so your kids can live high??
me thinks that having enuf to NOT depend on the govt for long term is a responsibility we all need to plan for...
Immoral or not, it's against the law. The law is the law.
20yrsinBranson
What is against the law? Using Medicaid? If you mean underhandedly shielding assets to qualify for Medicaid, I agree.
But I also read that if you give away your assets some 5 years before needing a nursing home it is not illegal to use Medicaid some 5 years or more later. Not terribly commendable, but that appears to be legal.
Again, I'm not voicing any opinions - just starting to learn about all of this stuff and the article struck me as an eye opener. I like hearing intelligent opposing viewpoints even if I wind up not subscribing to them.
Another consideration here, as yet unmentioned in this thread, is that not everyone is going to need nursing care before they die anyway. Some of us will drop dead of a heart attack, or die in our sleep, while we are still able to more or less care for ourselves. In fact, that is not unusual!
So a couple, or an individual, could shelter their assets, lose them all to a child or children in whom trust was misplaced, then die impoverished without ever needing nursing care! That would be a hell of an irony.
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