Long Term Care Insurance on The Rise

Long-term care insurance, which covers critical expenses like late life needs, nursing home care and at-home nursing care, is becoming too expensive for many retirees to be able to afford. This is an unfortunate discovery because many retirees are not appropriately prepared for the cost of long-term care. long term care

A study conducted by LifePlans determined that the average premium for long-term care insurance was $2727 in 2015, representing an increase of more than 40% from 2005. Up to 55% of the individuals who had opted not to purchase long-term care insurance, who are over age 50 made that decision because it was too expensive. Long-term care insurance helps to fill an important stop gap for retirees.

More than 40% of Americans over age 65 will spend at least some time in a nursing home, according to a recent report shared by MorningStar, others will need at home care as well. Medicaid will cover nursing care only for those individuals who have fully exhausted their financial assets.

Medicare will only cover nursing care under a few narrowed circumstances. Overall, more than $338 billion was spent on long term care services in 2013 alone. Long term care insurance may be a critical part of your plan for retirement and getting older, but you should also consult with a knowledgeable estate planning attorney about how to approach Medicaid advanced planning.

What Americans Need to Know About the Rising Cost of Long-Term Care

Do you have plans for what would happen to you if you were to become incapacitated? Many people are under the impression that long-term care is something that only older individuals need to consider. It is certainly true that a broad range of baby boomers and other elderly individuals have to think about their long-term care needs as it relates to their longevity and their healthcare concerns. However, anyone can be affected by a long-term care event.

Consider that some of the claims paid out by long term care insurance companies affect those individuals in their 20s. Just one car accident could have significant repercussions for you.

This highlights the importance of not only having the appropriate long-term care insurance in place, given that the cost of a private nursing home room on an annual basis is edging closer to $100,000 a year, but it also highlights that it’s important for individuals of all ages to have critical healthcare powers of attorney and other documents that articulate who is eligible to make decisions on your behalf, should you become unable to do so. The right estate planning attorney can help you determine what documents are most appropriate for your individual situation.

The best way to plan for long-term care is to have a system in place in the event that something happens to you or someone you know. Consulting with an estate planning and elder law attorney may be the first step you need to take.

Top Myths About Long-Term Care Coverage Through Medicaid

Usually, it’s Medicare that gets the bulk of news coverage, but Medicaid is still quite confusing for many people. Here are some of the most common misconceptions about Medicaid. shutterstock_129373694


You Must Be Poor to Get It

Medicaid helps people qualify for long-term care, and it’s true that you cannot have more than a specific amount of assets to qualify, but there are some exempted assets. Consult with your elder law specialist to learn more.


Medicaid Is Unnecessary Since Medicare Will Cover My LTC
Medicare only covers up to 100 days of skilled nursing care, so it’s not permanent. Medicaid is more likely to help a patient over the lung run.


Transferring Your Money to Your Kids Will Help With Medicaid Qualification

While it’s true that you don’t want to have too many assets in the Medicaid qualification process, you don’t want to assume that all your assets should be transferred to children. The reason is because there is a penalty period if Medicaid believes that you transferred assets in the years prior just to qualify for coverage.


Make sure you’re clear about how Medicaid- as well as Medicare- works when it comes to your long-term care. Contact an elder law specialist to get more details about this process. Our office is here to help at (601) 925-9797.

Paying for Long-Term and Nursing Home Care

Are you researching ways to pay for long-term care? Are you concerned that this added expense will bankrupt or place a huge burden on your entire family? Let’s talk about the issues at play when dealing with long-term care.

You Have Questions

Morton Law Long-Term Care

Paying for long-term care is a valid concern and a huge issue.

There are a few statistics you should be aware of:

  • On average, assisted living facilities cost $3,500 per month, which has increased by 4.29 percent over the past five years. Assisted living facilities could end up costing you $42,000 annually.
  • The average nursing home day rate is $240 per day, which has increased by 4.19 percent since 2009. Nursing home care could cost more than $87,000 per year.

There is long-term care insurance, but it is expensive, and it’s usually cost prohibitive. Don’t count on Medicare to pick up the tab, as it will only cover a small portion of the bill—although Medicaid is available for those who qualify.

Planning ahead can save your family from a negative inheritance. Nobody wants to leave behind stacks of doctor’s bills, but the issue of elder care is a confusing one. Seeking wise counsel is very important.

We Have Answers

I’ve developed this helpful and practical Medicaid webinar in response to all the questions I’ve received over the years. I’m in the business of planning estates and helping families prepare for the future. If you have questions, sign up for the webinar today, or call our office at 601-925-9797, and I can help you get started.

~ Ronald Morton


The Four Ways to Pay For Long Term Care

With increasing longevity and awareness surrounding elder care issues, more people are seeking out options to plan for long-term care. In the event that you or a loved one needs long term care assistance, there are four primary ways for which that case can be paid for: shutterstock_213995581

  • Self-pay. This involves the spending of personal assets to cover rehabilitation, nursing home, or at-home care. In many places, the annual cost of care is exorbitant, forcing an individual to spend through his or her assets in a few months to a year.
  • There are a lot of misconceptions about what Medicare will and won’t cover, but you should know that Medicare only provides for short-term rehab and not long-term care or custodial care.
  • Long-term care insurance. This kind of protection cannot be purchased after you or a loved one has developed a need for care. In order for the purchase to be affordable and for the policy to be approved, you’ll need to purchase it when you’re healthy and in advance of any long-term care events.
  • This is the only government program that covers long-term care, but you must need rigid income and asset guidelines in order to receive benefits. An elder law attorney can help you understand what you need to know in order to qualify for Medicaid.

Contact us for more advice about planning for the future at (601) 925-9797.

Commonly Asked Medicaid Questions

Q:Once I qualify for Medicaid, will the quality of care I receive be sub-standard?

A:No. It is illegal for a facility to discriminate against someone receiving Medicaid benefits. By law, Medicaid patients are to receive the same level of care as private-pay residents.

Q:Is a married couple always required to spend down all of their assets before qualifying for Medicaid?

A:No. In fact, where there is a spouse who remains outside of the nursing home, that spouse is entitled to retain $113,600. Additionally that spouse may also keep the monthly income up to a maximum of $2,841, for their additional support. Also, in some cases it is possible for the at-home spouse to retain additional assets if it can be shown that they need it for their support. Although there are income and asset criteria a couple must meet before one of them qualifies for benefits, federal and state laws were written to protect individuals from becoming impoverished if their spouse needs nursing home care.

Medicaid planning is like tax planning in that legislation has provided legal exceptions to the general rules that, with good advice from a knowledgeable professional, can save Medicaid applicants and their families thousands of dollars.

Q:Is it true that under current Medicaid laws, a parent cannot make financial gifts to their children once they have entered the nursing home?

A: No. In fact, a proper gifting program is a great Medicaid planning technique. At the time an applicant applies for Medicaid, the state will “look back” 5 years to see if any gifts have been made. Any financial gifts or transfers for less than fair market value during the five year look back may cause a delay in an applicant’s eligibility. A proper gifting program requires calculating the penalties prior to making gifts and designing a way to privately pay during the penalty period.

Q:Is $13,000 per year the maximum an individual can give away if they are going to apply for Medicaid?

A: No. The $13,000 per year gift people ask about when discussing Medicaid Planning is a tax law figure and not relevant with respect to Medicaid’s specific asset transfer rules. The maximum monetary figure Medicaid applicants need to concern themselves with is the “penalty divisor.” The penalty divisor is the state

assessed average cost for nursing home care by which the state assesses Medicaid penalties. The penalty divisor is $5,700 in Mississippi.

Q:A Medicaid applicant’s house is considered “exempt” under Medicaid laws. Can an applicant give their house away without incurring penalties?

A:Sometimes. Any assets which are given away (personal property or real property) are considered gifts. Usually, if an applicant gives their house away, the state will assess a penalty based on the fair market value of the house at the time it was transferred. However, there are some exceptions to this rule that a qualified elder law attorney can explain.

Q:Once my spouse is approved for Medicaid, can I gift my assets away?

A:No. In Mississippi, however, any gifts made by the community spouse would incur penalty which may result in the termination of Medicaid benefits for their spouse.There are a number of steps a Medicaid applicant can take to preserve their assets, ranging from gifting strategies, personal care contracts, private annuities, raising the Community Spouse Resource Allowance, etc… What you need to remember is that the laws are constantly changing and the planning your neighbor did for their mother six months ago may not be proper for your mother tomorrow. Consult a knowledgeable elder law attorney for advice.

For more information on Medicaid Planning, click here.

Clinton Elder Lawyer’s Advice: Create a Personalized Healthcare Directive

When a Clinton elder lawyer’s clients enter a hospital or other medical facility, they have the peace of mind that comes from knowing their healthcare wishes will be made clear to the staff.  This is because the attorney and the client were able to sit down and go through various situations and scenarios to put together a personalized healthcare directive.  When you don’t have one of these in place, the hospital will likely ask you to use their forms to create something similar.

While it’s better to fill out their form than to have no healthcare directive at all, it’s important to remember that it will not be personalized to fit your needs.  When the hospital or other institution puts their forms together, they do so for a wide, unknown audience.  The topics covered will be those which the hospital (or its lawyers) find important, rather than those which are meaningful to you and your family.

Basically, this document is where you name the person that you want to make medical decisions should you become unable to do so yourself.  Oftentimes, this person is a spouse, but if you are unmarried or simply want to appoint someone else, then a healthcare directive is especially important.  Remember that if you don’t assign the role, the legal system will do so for you, choosing a “close” blood relative, such as your adult children (or your parents, for younger folks) to make the medical decisions you are unable to make at the time.

Provide Guidance about Your Wishes

Your Hinds County elder lawyer will not only have you appoint someone, he or she will also help you to make many medical decisions in advance.  By recognizing potential medical situations and declaring your wishes, you can lessen the burden for the individual who will ultimately be responsible for your care.  For example, what are your feelings about life-sustaining measures such as feeding tubes and respirators?  Are there situations in which you would want these used and/or situations where you would not?

This is also a good place to make any religious or cultural restrictions known.  For example, some groups do not agree to have blood transfusions performed.  If this is the case for you, then your healthcare directive would be the place to make it known.  Ideally, you would discuss your thoughts and decisions with the person you have named so that he or she is aware of your feelings and can use that understanding to guide him or her if other circumstances were to happen.  Obviously, your healthcare proxy won’t cover every potential situation, so it’s beneficial for the appointed person to have a good understanding of your beliefs in order to make decisions which are in alignment with what your wishes would be.

Important to Remember

If you have gone through the effort to work with your Hinds County elder lawyer to create your personalized health care directive, make sure that it isn’t undone by filling in one of the generic healthcare proxy forms at the hospital.  If you use their form, you can negate the one you created with your attorney.

Making Long-Term Care Insurance a Part of Your Estate Plan in Clinton

Working with a trust and estates attorney in Clinton is an excellent way to prepare for the future and to protect the assets you want to pass on to your loved ones after you’re gone.  A qualified Hinds County lawyer will be able to offer you valuable advice, not only on setting up a will or trust, but also on creating other important documents, such as medical directives and powers of attorney.

One area that often gets overlooked in the estate planning process is long-term care insurance.  There are different reasons why it gets ignored:

  • I’m too young to think about long-term care (whether you’re 40, 50, 60, or more)
  • I already have medical insurance, isn’t that good enough?
  • I don’t want the added expense of long-term care insurance
  • I have enough money set aside for nursing home or other long-term care

Some or all of these justifications may be true, but it really does make sense to at least discuss the risks with your Clinton trust and estates attorney.  For example, were you aware it is estimated that 60% of people over the age of 65 will need some kind of long-term care in their life?  Also, how confident are you that your health insurance will pay for long-term care?  You will definitely want to double-check that, as most private insurance, as well as Medicare, do not cover most long-term care services.

Keep in mind, too, long-term care isn’t just for the elderly.  Many younger people involved in accidents or who are diagnosed with a particular disease or illness will also require long-term care.  In many cases, this type of care will take place in a hospital or rehabilitation center, and it’s important to know where the money will come from to pay the expenses.

Of course, that’s not to say that everyone needs long-term care insurance.  Again, your Hinds County estate planning attorney can help you assess your risks and determine the right course of action.

What Long-Term Care Insurance Does

Long-term care is certainly beneficial in paying for nursing home expenses, but it doesn’t necessarily exclude other types of care settings.  It may be used to pay for in-home care, for example, or to help with the costs of adult day care or assisted living facilities.

Basically, long-term care insurance comes into play when an individual has lost the ability to take care of two or more of their own daily activities. These are usually defined as:

  • Bathing
  • Continence
  • Dressing
  • Eating
  • Toileting
  • Transferring

There are some other impairments which can trigger the need for long-term care, even if the person involved is still able to function in all of the ways listed above.  For example, a person with Alzheimer’s may still require long-term care, even if he or she is able to perform all six of the daily activities.

Of course, long-term care isn’t just about daily activities.  It can also be used to pay for health care and rehab costs recommended by a physician. Physical or speech therapy may be covered, as well as the need for professional care by a registered nurse.

Your trust and estates attorney in Clinton will work with you to help answer the most important questions in purchasing a long-term care insurance product.  Based on knowledge of the Hinds County area, the lawyer can guide you as you determine where in the community you might be most interested in receiving care and help base estimated coverage needs on this and other criteria.


Families are Primary Long Term Care Providers

The American Association for Marriage and Family Therapy states that “more than ever before, families are providing long-term care to older adults with limitations in the ability to perform tasks necessary for independent living. Nearly 25% of American households are providing care to people age 50 years and over.  The Jackson, Mississippi metro are is no exception.  Families are the alternative foundation for a stressed healthcare system. Hospital stays are shorter than ever and family caregivers are often expected to do what healthcare professionals once did.”

Family caregivers in Mississippi take over various responsibilities for their elders.  It may be just handling finances, running errands, going to doctor appointments or taking on full 24 hour care services.  In most cases one sibling in the family will become the main caregiver, but most successful ventures are supported by the entire family.  Many times this duty falls on the child who lives in the same city, such as Jackson, Mississippi.  More frequently than not, it is the oldest daughter.

There is a saying that it takes a village to raise a child.  This may be true, but it takes a family to care for an aging parent.  As seniors lose physical and cognitive function they become vulnerable and unable to manage their own care.  Who better to know their needs and desires than their own children.  Even if professional care givers are providing services, family involvement makes the difference in quality of life for their parents.

“If one family member has been designated caregiver other members can give support with respite care, transportation to doctors, etc., everyone needs to be aware of all that is needed and be in total agreement to do it.”  “The 4 Steps of Long Term Care Planning

Experience has shown that even families that are close can quickly grow angry, jealous and hostile towards each other when an aging parent begins to need long term care. If a sibling moves into the parent’s home, others can easily be suspicious of ulterior motives and fear to lose their inheritance. On the other hand, the child doing the entire care taking becomes bitter and feels there is no support or help from siblings.

One example of a family misunderstanding is that of a brother accusing his sister of stealing all of the money from the sale of his parent’s home.

Karen, who was a single mom with two children, moved in with her parents when her father had a stroke to help her mother take care of him. Her mother was also disabled. Needing money to pay for a home care service, Karen helped her mother do a reverse mortgage on the home, which gave the needed funds. If communication had been open and Karen’s brother had known the need and been involved with his parents care, he would not have reacted so negatively when he eventually found out about the reverse mortgage.

Every family is different. Some families are close and some have never been compatible. If your communication is strained, consider having a professional mediator present at a family meeting. The mediator will be able to keep things calm and running smoothly and help work out each persons concern.

Family matters.  The experience of working together for their parents care can give aging parents and family members a peaceful, memorable experience.

CLASS Act Casualty of “Fiscal Cliff” Deal

The final budget deal Congress passed to avert the “fiscal cliff” repeals a long-term care insurance program that would have helped keep the elderly and disabled out of nursing homes and off the Medicaid rolls.  In its place, the budget bill establishes a commission to come up with an alternative plan to make long-term care available for those who need it.

The Community Living Assistance Services and Supports (CLASS) Act, part of the health reform bill and Sen. Edward M. Kennedy’s final legislative legacy, would have established a voluntary national long-term care insurance program offering basic help for the elderly and disabled. Employees who wished to participate would have paid into it, much like they pay into Social Security, and would have received a modest daily benefit if they required long-term care.

The Obama administration suspended implementation of the CLASS Act in October 2011 over concerns that the program could not be self-supporting, but the administration had resisted calls to repeal the law, hoping that changes could make it financially viable.

But the administration’s resistance ended during negotiations over legislation to avert higher tax rates for all Americans.  According to The New York Times, repeal of the CLASS Act was one of the “sweetener” provisions thrown in by both parties to attract votes.  The Times notes that Senate Republican leader, Mitch McConnell (R-KY), who was an architect of the budget deal, had criticized the CLASS Act, saying it was “destined to fail in the real world.”

But reportedly at the insistence of Sen. Jay Rockefeller, (D-W.Va.), the measure establishes a 15-member Commission on Long-Term Care that is to recommend legislation in about six months.  (The Commission’s mission and powers are described beginning on page 120 of the budget bill.)  The Commission will be a bipartisan body consisting of members to be appointed by the President and congressional leaders within one month of the budget bill’s enactment.  Members will represent the interests of the elderly, consumers of long-term care services, family caregivers, private long-term care insurance providers and employers, among others.