Medicaid and Public Benefits Planning

Protecting Your Family’s Assets from Catastrophic Care Expenses and Nursing Home Costs

The Law Office of Donald D. Vanarelli has developed a significant expertise in the field of Elder Law, a legal specialty focusing on the special needs and legal problems of the elderly, the disabled and their families.

For each client, the Law Firm develops a comprehensive long-term care plan designed to find, get and pay for quality long-term care, while protecting the family’s assets from catastrophic care expenses and nursing home costs. These plans often require qualifying the family for needs-based public benefits, such as SSI and Medicaid, so that the client can pay for quality care and the spouse, children and other heirs are provided with adequate income and resources. Asset protection planning strategies which may involve the transfer of client resources are often used. Wills, Living Wills, Durable Powers of Attorney and Trusts are often employed. Long-term care insurance may be recommended. Guardianship and other court proceedings may be required.

The Demand for and Cost of Long-Term Care

Both the demand for and cost of long-term nursing care have risen dramatically in recent years. Statistics show that approximately 43% of the population aged 65 years and older will spend some time in a nursing home. The average length of stay is 2.9 years. The cost of nursing home care in northern NJ is about $10,000.00 per month, or about $120,000.00 per year.


Financing Nursing Home Costs

There are five (5) sources for financing nursing home costs in New Jersey:

  1. Private Pay - under private pay, the client or family pays the cost of nursing home care from personal savings. In the usual case, the client pays until he or she is impoverished, and then turns to Medicaid. .
  2. Nursing Home Insurance - Fewer than 1% of nursing home residents are covered by long-term care insurance.
  3. Medicaid - the major source of funding for residents of long-term care facilities in NJ. Of the more than 44,000 residents in NJ nursing homes, more than 65% are on Medicaid.
  4. Medicare - under certain conditions, Medicare will pay for nursing home costs, but for a maximum of only 100 days of care.
  5. Veterans Benefits - The VA operates 3 nursing homes in NJ. Eligibility is restricted to veterans and their families.

The Goal: Access to Quality Care at Affordable Cost

Long-term care planning has a single goal for the client: access to quality care. This is an essential human need in every circumstance. Unfortunately, this need often goes unmet due to cost; long-term care is the most expensive health care cost. Often, there is no insurance or other assistance available to help clients pay for long-term care. As a result, most clients use their personal savings until their assets have been depleted. They may then qualify for Medicaid and other needs-based public benefits. However, there are planning techniques available to accelerate eligibility for Medicaid and preserve assets for the spouse, family and other heirs. These techniques are used by the Law Firm to help clients obtain essential care.

Creating the Long-term Care Plan

A long-term care plan broadens the traditional estate plan to (1) provide for access to quality care for the client, his or her spouse, partner or dependents, and (2) develop a strategy to fund that care. Items which the Law Firm may consider and discuss in developing a client’s long-term care plan are:

  1. Detailed collection of client financial and family information;
  2. Legal documents;
  3. Evaluation of care needs;
  4. Financial analysis;
  5. Tax issues related to income, capital gains, the sale of real estate, etc.;
  6. Client suitability for long-term care insurance;
  7. The home;
  8. Appropriateness of the client’s current Medicare, Medigap and other health insurance coverage;
  9. Client competency and ability to manage personal and financial affairs; and,
  10. Strategies for accelerating eligibility for Medicaid and other needs-based public assistance.

Additional Information

For additional information regarding Medicaid and Public Benefits Planning, call us at 908-232-7400 or click here to contact us online.