What do you do when you or a senior loved one needs care now — a crisis situation — and they have some money available? Elder law attorney Jim Koewler joins Suzanne Newman to answer this question.
In this situation, one option is to choose to private pay for the care. This segment focuses on financial eligibility for married couples to receive VA pension benefits and Medicaid. More providers don’t want to participate in Medicaid’s reimbursement because it doesn’t pay as much as private pay, though this could change in the face of COVID.
If you’re married, to get Medicaid you have to spend your assets down below $2,000 (Federal and Ohio levels; amounts vary by state). If you have more than $260K, the healthy spouse would be able to keep about $130K. The rest of it is attributed to the one who needs care and must be spent down. The VA has roughly similar levels whether you’re single or married, but there is no 50/50 split between spouses. VA penalizes money given away in the last 3 years; Medicaid for the last 5 years. There are differing effects on property ownership, depending on your state.
What you can do with your wealth differs with VA pension benefits and Medicaid, but you can still spend. Spending is OK — you can’t give away without the potential penalties, and the penalties are treated differently in the two programs as well. If you want to spend on things that make sense, for instance on a lift chair, or comfortable clothes that are easy to take on and off, or hearing aids, dentures, glasses, or four cruises around the world, that’s OK.
Jim Koewler addresses later-life financial and legal issues. Talk to an elder law attorney to guide you in your state with your situation. Learn more at Answers for Elders or at Jim’s website.
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*The following is the output of transcribing from an audio recording. Although the transcription is largely accurate, in some cases it is incomplete or inaccurate due to inaudible passages or transcription errors.
The following podcast is by Mr Jim Koewler, elder law and special needs attorney, helping and protecting those who need long term care, and welcome everyone to answers for elders radio network. To End, we are here again with the amazing wonderful Jim Taylor, who helps us with all of the later life financial and legal issues that come about as a wonderful elder law attorney and my friend, Jim, welcome back to the show. Thank you. I’m not sure a qualifies amazing and wonderful, but thank you for the g you are amazing and wonderful, you know. I always think that of you and I’m so thrilled that you’re on the program today because right now it’s an interesting time. People are a lot of spring cleanings happening, a lot of thoughts for downsizing and a lot of things where people have been together during the holidays and they’re trying to figure out what next steps are. And you know, a lot of these moves and these major things happened during this, you know, the summer season, and so this is a time really important to talk about, especially because it’s tax season as well. But people are looking at obviously, if there’s a health issue or all of a sudden I need you know, I’m concerned about long term care. How am I going to pay for it? And it is a very daunting scenario to try to figure out how to do this. And so we’re here today talking about this topic to our listeners, and Jim tell us a little bit about what families go, you know, deal with when they’re approaching this time. Okay, so today I want to focus on people who need care. Now what elder law attorneys called crisis work, because you and I have talked in the past, in previous installments, on thinking ahead if you’re worried about it in the future. So today let’s talk about someone needs care, a loved one needs care, and the loved one, or the married couple, and that includes a loved one who needs care, still have some money. What’s going to happen? Yeah, okay, so they can choose to private pay for care, and more and more places, at least around me. I’m in northeast Ohio, and I suspect this is true nationally. More and more places do not want to participate in medicaids reimbursement because it doesn’t pay as much as they can get part. So, and this is especially true of assisted livings and memory care units. Okay, so place that has memory care may not take Medicaid at all. Right, especially if it’s an assisted living style or an assisted living if you don’t need memory care. A lot of assistant livings don’t want to take Medicaid because it just simply doesn’t pay that much and they think they can keep themselves full. I think the pandemic is going to change all on minds on that. We as you know, there’s the inherent reluctance to move into a nursing home where syste living was there before and it just jumped. That reluctance just went through the roof because the pandemic. You don’t want to be in a place with lots of other sick people and you may get covid. So so I there may be some softening of some of these places to take Medicaid, but we’ll have to see. Depends on whether they’re there is so full. I know there is with home care to it’s softening. Yeah, which is good. Yeah, yeah, home care, because that’s the alternative. You need care in your family just can’t do at home cares. The way to go and most states have a medicaid program for home care. But the financial eligibility is the same. The incomes a little different, but but what to do with your wealth is pretty much the same. So what happens if you need care? I’m just going to say you and talk to the people who need it, but the loved ones can listen in and just kind of follow along with absolutely you. Okay, so you need care and you still have some money and you’re married. So it’s different when you’re married than when you were single, both through va benefits and through which is going to be the pension medafit. We talked about pension extensively in the past. Sure is it’s going to be different through va pension than it is to Medicaid. But there’s still is for a married person, is different va than it is for single person, and Medicaid is different for a married person that it is for a single person. Okay, and dependent, just just to get it out there, the state you’re in and and it’s Medicaid program may not recognize common law marriage and I don’t think that va recognizes common law marriage. So if you’re not married, married married certificate, the whole nine yards. Medicare doesn’t either. Yeah, you may not. Now some states recognized. Okay, some states recognize common law marriage, but I know Ohio doesn’t. I don’t know, but any other state? But that’s a that’s consideration. If you’re trying to claim on common law, you got to find out first and you may want to get married or may not. There are other things about married you may not like. So so let’s say you’re married and one of you needs longterm care. It just and home and the family’s not enough anymore. You got to get some professional help. Okay. So the to get Medicaid you’d have to spend down and get your assets your okay, now the Dow. I’m compartmentalizing in the individual your assets down below two thous in Ohio two thousand dollars is the federal standard, but some states or his lowest fifteen hundred bucks. And that’s a very state by state thing, and I’m not going to list the states here. I mean you can find out about your own state. You’re not going to apply in different states, okay, but we’re your this is that’s low. That’s that’s almost nothing. Okay. So with a married couple, the the federal rules and the state rules that have to follow her to rules are going to allow the well spouse, the one who does not need care, to keep a certain amount of money, and it depends where you get start. Okay, about at about a hundred thirty thousand dollars the well. Let me back up on that. If the family has a bunch of money, you know that the couple has more than two and sixty thousand dollars, the spouse who is well is going to be able to keep about a hundred thirty of that. If they have more than two hundred and sixty the spouse who is well, it’s still going to be capped out about a hundred thirty. Okay, it’s a multiple of federal poverty level. It’s not around dumber anymore, but a hundred thirty’s a good rule of thought. Okay, the so if there’s half a million dollars, the spouse whose welst don’t I get to keep about hundred thirty. So and then the rest of it is without changing names on anything at the beginning, is attributed to the one who needs care and then has to be spent down to two thousand and one thousanive hundred and sixteen hundred and whatever your state requires. Excuse me. So now va has roughly the same number. There two hundred thirty eight thousand for eligibility, whether you’re single or married. The difference between Va in a married couple is how much you get each month through the pension program a married person gets, can get more, at least has a maximum that’s higher than a single person. Okay, okay. So if you’re single and want to get va coverage and you got a hund three thousand dollars and it gets really squarely, as we discussed before with you have to count your income for va purposes, income your health care expenses, and va gets to calculate those. You can estimate, but you may not do in the same way. BEA does get squarely, but we’re still at threezero dollar ballpark. Okay. So this there is if you’re two hundred thirty, there’s no spend down. If you’re single, you’re not qualified, again, including the income thing. If you’re married, you’re still a hundred thirty. There is no split. Okay. So what Medicaid would allow a married couple to keep, which is half of up to two hundred and sixty does. There is no fifty split with a with a wealth spouse or an ill spouse. Okay, but you still come out to about the same number. Sure so. But va penalizes money you gave away within the last three years. Medicaid penalizes money you gave away with the last five years. Yep, met it. Medicaid usually ignores your house and its entire acreage. Va Ignores your house and two acres. So if you if you’re in a property development and everybody’s get two acres or few are less of area, you’re fine. If you’re on a farm, yeah, most that farm is going to count against your hundred thirty grand for va persadness. Okay. Now, Medicaid may not beat you up on on the acreage, but they may say your lots aren’t continuous right or they may say the House with your the lot with your house on it counts, but all the others, if they have different property numbers, that counts toward your resources and that counts toward the how much can your spouse keep, how much can you keep, etc. Okay, and that’s a stay another state by state thing. You know, one state may be more forgiving on extra property as long it’s contiguous. Another state may not. I’ve seen, you know, a little sliver or road down the middle. No, that’s not contiguous, even though you’re farming both sides of the road. So once you can do with your wealth. Is really different between the two programs. Okay, but you can still spend. Spending is okay. You just can’t give away. Now. You can give away, but you have to deal with the penalty that comes with it. Okay. Right, says that I’ll shot now give away and if you look hard as well, if you give away, this is what we’re going to do to you. Okay, but you still got to pay for care in the interview. Can Okay. And the way va penalizes you for giving stuff away is different than the way Medicaid penalizes you for giving stuff away. Right Y, a penalty starts the month after the last giveaway. Okay. So if you give away a bunch of month, a month, siral months in a row, the penalty starts after the last one. So if you gave away a bunch two years ago and then a little bit last month, that big bunch two years ago catches up to this month and your penalty is big. Okay, wow, but it starts the month after you give it away. So if you give away a bunch several months ago, waited way to wait to than then applied for be a benefits, your penalty may be gone because you outweigh it. You know you last it. You know you waited until the penalty was over, whether you realized it or not. Right, right. Medicaid penalty, if you gave away with the last five years, it does not start until your in in someplace that would qualify you for Medicaid. You have applied and you’re poor enough to qualify. But for the penalty, they really try to make it difficult to give money away in the in the Medicaid program that goes back to the two thousand and seven federal amendments to the medicine. Sure, so it’s tricky what you can do with it, but if you want to spend on things that make sense, I’ll lift chair, comfortable clothes to sit around and easy to take on and put in, to take off on, a put on hearing aids, eyeglasses, dentures, those are great. Okay. If you want to take four cruises around the world, that’s still all. It’s still okay. Now you for your money. It’s okay and you can apply for a medicade when that money is gone. Yeah, it’s manditures are okay, same for me. Yeah. Well, let’s talk a little bit more in our next segment about what constitutes a spend down. How does it all come together? I think this is really fascinating information and I want to ask you some real specific questions of families of what they’re dealing with right now, because there’s a lot of questions about how the laws are changing, about that and and I’m so jim and I will be right back in part two of this segment. Right up to this state of Ohio, residents, you have a friend to help you navigate long term care while protecting your assets. You can reach Jim at wwwoprotecting Seniorscom or just email him at j Koewler afe. That’s J KAYLOR AFE at protecting Seniorscom.
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Founder and CEO of Answers for Elders, Inc., Suzanne Newman proclaims often, “Caring for my mom was the hardest thing I ever have done, but it was also my greatest privilege.” Following a career of over 25 years in sales, media, and marketing management, Suzanne Newman found herself on a 6-year journey caring for her mother. Her trials and tribulations as a family caregiver inspired an impassioned life mission outside of the corporate world to revolutionize the journey that so many other American families also find themselves on. In 2009, she became the founder and CEO of Answers for Elders, Inc., subsequently hosting hundreds of radio segments and podcasts, as well as authoring her first book. Suzanne and Answers for Elders, Inc. have spent 14 years, and counting, committed to helping families and seniors along their caregiving journeys by providing education, resources, and support. Each week on the Answers for Elders podcast, Suzanne is joined by vetted professional experts in over 65 categories including Health & Wellness, Life Changes, Living Options, Money, Law, and more. Suzanne lives in Edmonds, Washington with her husband, Keith, and their two doodle dogs, Whidbey and Skagit.
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