How Much Care Will You Need?
The duration and level of long-term care will vary from person to person and often change over time. Here are some statistics (all are “on average”) you should consider:
- Someone turning age 65 today has almost a 70% chance of needing some type of long-term care services and supports in their remaining years
- Women need care longer (3.7 years) than men (2.2 years)
- One-third of today’s 65 year-olds may never need long-term care support, but 20 percent will need it for longer than 5 years
Distribution and duration of long-term care services
|Type of care||Average number of years people use this type of care||Percent of people who use this type of care (%)|
|Any Services||3 years||69|
|Unpaid care only||1 year||59|
|Paid care||Less than 1 year||42|
|Any care at home||2 years||65|
|Nursing facilities||1 year||35|
|Assisted living||Less than 1 year||13|
|Any care in facilities||1 year||37|
Who Pays for Long-Term Care?
The facts may surprise you.
Consumer surveys reveal common misunderstandings about which public programs pay for long-term care services. It is important to clearly understand what is and isn’t covered.
- Only pays for long-term care if you require skilled services or rehabilitative care:
- Does not pay for non-skilled assistance with Activities of Daily Living (ADL), which make up the majority of long-term care services
- You will have to pay for long-term care services that are not covered by a public or private insurance program
- Does pay for the largest share of long-term care services, but to qualify, your income must be below a certain level and you must meet minimum state eligibility requirements
- Such requirements are based on the amount of assistance you need with ADL
- Other federal programs such as the Older Americans Act and the Department of Veterans Affairs pay for long-term care services, but only for specific populations and in certain circumstances
GOOD TO KNOW
Like public programs, private sources of payment have their own rules, eligibility requirements, copayments, and premiums for the services they cover.
- Most employer-sponsored or private health insurance, including health insurance plans, cover only the same kinds of limited services as Medicare
- If they do cover long-term care, it is typically only for skilled, short-term, medically necessary care
There are an increasing number of private payment options including:
PLAN BEFORE YOU HAVE A NEED
Planning for the eventuality of needing long term care is critical in reducing stress and uncertainty. Meeting with an Elder Law attorney familiar with the rules of Medicaid qualification is a step in the right direction. Contact our office for a no-obligation consultation to see if developing an estate plan with the goal of Medicaid qualification is a right fit for you.
My mother is in a nursing home. Can she still deduct this expense?
Yes. For 2018, in certain instances nursing home expenses are allowable as medical expenses.
- If you or someone who was your spouse or your dependent, either when the service was provided or when you paid them, is in a nursing home primarily for medical care, then the entire cost including meals and lodging is deductible as a medical expense.
- If the individual is in the home mainly for personal reasons, then only the cost of the actual medical care is deductible as a medical expense, not the cost of the meals and lodging.
To determine if your mother qualifies as your dependent for this purpose, refer to Whose Medical Expenses Can You Include and Nursing Home in Publication 502, Medical and Dental Expenses.
- Deduct medical expenses on Schedule A (Form 1040), Itemized Deductions.
- The total of all allowable medical expenses must be reduced by 7.5% of your adjusted gross income.
This write-off is only available to filers who itemize. People who qualify for it can deduct insurance premiums paid with after-tax dollars, plus many costs not always covered by health insurance—such as for long-term care, prostheses, a wig after chemotherapy and more.
The report issued on the roll-out of the computer system shows continued problems
The Rhode Island Department of Human Services (“DHS”) which administers the Medicaid program has been attempting to roll out a new computer system for several years. The system was designed to speed up application review and automate the application process to an on-line system. Unfortunately per the auditors report, the system is still experiencing issues.
For those attorneys who assist elder clients with Medicaid applications this has been a challenging time. Medicaid will pay for the nursing home care needed by these elderly clients who have less than $4,000 in countable assets. It is stressful to family members who have submitted applications for coverage, who have a loved one being cared for at a nursing home, and not knowing if their application has been approved. They fear the consequence of an unexpected denial and how that may impact a spouse or the recipient.
Applicants can wait months or years prior to receiving an approval of their application.
Rhode Island law requires DHS to pay nursing homes for any care given patients who have applications pending for greater than 90 days. This law has allowed payments to go out, facilities to get paid, and patients to receive the care they need, until the application is approved.
Fortunately, the reports also states that things are improving and applications are being reviewed quicker and more accurately. The employees at DHS have done an admirable job overcoming a challenging roll-out but still have much work to do.
If you or a loved one wants to learn more about qualifying and applying for Medicaid benefits, please contact our office for a free consultation.
Caretaker Child and Medicaid Qualification
Children are often confronted with difficult decisions when time and age catch up with their parents. Many children have been pushed into the role of being primary caregiver for their parents. The motivation stems from the very reasonable wish to keep parents at home for as long as possible despite health and medical issues of parents that indicate the parents need additional assistance with activities of daily living.
When children assume the role of caregiver to their parents with the goal of being able to avoid nursing home care for parents, there are benefits to this arrangement. Beyond the obvious advantage of the peace of mind of knowing you are doing all that you can keep your parents comfortable.
When a parent reaches the point in life where medical needs are increasing, it is prudent for the surrounding family to contact an elder law attorney who can explain the necessary and proper documents to have in place for parents so that children can assist with the parents legal and medical needs.
In addition, the elder law attorney should be prepared to introduce you to the Medicaid program and how it works for people who are expected to need skilled nursing and long term care.
Family should advise the elder law attorney about any children living at the home caring for a parent. These facts create a unique opportunity to protect the home of the parent from possible long long term care costs while still maintaining Medicaid eligibility.
If a child lives with a parent of the two (2) year period before the parent needs to enter into a nursing home, an if the child had not been with the parent the parent would have had to live in a nursing home, the parent can transfer the home to the caretaker child without being disqualified from Medicaid benefits. The parents doctor needs to certify to this arrangement and time frame for this exception to the transfer penalty to work.
The below link to an article explains some of the things that will need to be demonstrated to take advantage of this Medicaid planning opportunity. In Rhode Island, the rules are similar to the attached article but concerned individuals should meet with an elder law attorney to discuss the caretaker child exception as it applied to their facts.
Want to lean more? Contact our office for a no-cost consultation.
PROVIDENCE, R.I. — Rhode Island ranks 32nd in the nation, and the worst in New England, when it comes to meeting the long-term care needs of older residents and people with disabilities, according to a scorecard released this week by the national nonprofit AARP.
The good news: Rhode Island showed improvement in all but one category.
“The vast majority of older Rhode Islanders want to live independently, at home, as they age — most with the help of unpaid family caregivers,” Kathleen Connell, state director of AARP Rhode Island, said in a statement released Wednesday. “Even facing tight budgets, Rhode Island is making progress to help our older residents achieve that goal. However, this scorecard shows we have more to do, and we need to pick up the pace.”
Rhode Island ranks 22nd nationally “support for family caregivers” and 24th in “quality of life and quality of care.” The state ranks 35th in “effective transitions,″ or how effectively the state transitions residents between nursing homes, hospitals and homes — the only category that showed a decline.
The report — “Picking Up the Pace of Change: A State Scorecard on Long-Term Services and Supports for Older Adults, People with Physical Disabilities, and Family Caregivers” — is the third in a series that ranks states overall and on 25 separate indicators in five key areas: affordability and access; choice of setting and provider; quality of life and quality of care; support for family caregivers; and effective transitions between nursing homes, hospitals and homes.
Unpaid family caregivers provide the bulk of care for older Rhode Islanders, in part because the cost of long-term care remains unaffordable for most middle-income families, according to AARP Rhode Island. More than 134,000 Rhode Islanders help care for their aging parents, spouses and other loved ones so they can stay at home. AARP estimates the value of this unpaid care at about $1.78 billion.
“Many [family caregivers] juggle full-time jobs with their caregiving duties,″ Connell said, while “others provide 24/7 care for their loved ones.” Family caregivers “save the state money,″ she said, “by keeping their loved ones out of costly nursing homes – most often paid for Medicaid.″
Rhode Island improved its rank from 50th to 44th in the percentage of Medicaid long-term care dollars for older adults and people with physical disabilities that support care at home and in the community.
The report comes at a time when proposals in Washington are being considered to drastically cut federal Medicaid funding, which Connell said “would threaten these advancements, likely resulting in our most vulnerable citizens losing the lifesaving supports that they count on.″
The AARP Rhode Island has more than 138,000 members age 50 and older in the state.
New England Scorecard Rankings (best to worst):
New Hampshire: 16
Rhode Island: 32
Affordability and Access: 34
Choice of Setting and Provider: 30
Quality of Life & Quality of Care: 24
Effective Transitions: 35
On Twitter: @LynnArditi
Troubled launch of the State’s new UHIP computer system at center of issue
Since the launch of the Rhode Island’s trouble social services system, UHIP, many nursing homes have gone without payment for Medicaid patients. Owed for months of care, many administrators are concerned they won’t be able to go without payment for much longer.
Debra Griffin is the administrator at Hattie Ide Chaffee Nursing Home and Rehabilitation in East Providence. She also chairs the state nursing home association. Griffin says the system for getting paid for these patients was inefficient before but it’s worse now.
“We haven’t received an approval since September. And that was for someone back to last April,” says Griffin.
Griffin says firing Department of Human Services workers who understood long- term care Medicaid applications before the launch of the new system was a mistake.
“Long- term applications are not run of the mill,” said Griffin. “You have to have a level of knowledge and expertise in the approval process.”
Governor Gina Raimondo acknowledges letting workers go before the launch of the system that was a mistake. The Governor has just accepted the resignations of two top officials involved in the launch. But Griffin says that the governor’s latest actions to fix the problem may not be enough to solve nursing homes’ financial woes.
Griffin says the state owes her home more than $200,000, and most nursing homes in the state are still awaiting payment.
The original Article was written by Kristen Gourlay for RINPR and can be found HERE.
Rhode Island has the 10th highest nursing home costs in the nation at an average of $94,170 annually, according to Caregiverlist’s August report.
Caregiverlist Inc., which connects seniors and professional caregivers with eldercare options, said Rhode Island bumped Maine for having the 10th most expensive costs in the country. Rankings were based on the daily prices of shared rooms in nursing homes.
Caregiverlist said that with 87 nursing homes, the average cost for a shared room in a nursing home in Rhode Island is about $258 a day. In comparison, Texas has the lowest annual cost – a shared room there costs $115 a day. Alaska, due to its low population and remote location, has the highest daily cost for a shared room at $751, according to Caregiverlist spokeswoman, Julie Northcutt.
Rhode Island’s average daily shared room cost also is lower than that of Connecticut and Massachusetts, where average daily costs of semi-private rooms total $321 and $289, respectively.
A private room in Rhode Island averages $263 a day. Hawaii has the highest costs for a private room at $488 a day, followed by the District of Columbia at $371 and Connecticut, $351. The least expensive daily cost for a private room is in Missouri at $145.
Caregiverlist said the Rhode Island nursing home with the highest overall Caregiverlist star rating is the privately-owned, 122-bed Briarcliffe Manor in Johnston, which received 4.6 out of 5 stars. Caregiverlist said five is the best rating for a nursing home, while one is the worst.
It said the cost of rooms at Briarcliffe are slightly higher than the average Rhode Island nursing home at $325 and $300, for single and double rooms, respectively, but are not the costliest in the state.
This story was written by Lori Stabile and published by the Providence Business News on August 9, 2016 www.pbn.com.
Concerned with protecting your life savings from the high costs of nursing homes in Rhode Island?
Learn about the options available. Contact our office for a no-cost consultation to discuss what steps you must take now before it is too late.
Doesn’t Medicare Pay for Most Long Term Care Needs?
No. Even though many people mistakenly believe that Medicare will take care of most long term
health needs, it pays for less than 2% of the cost. A survey conducted by AARP (American Association of Retired Persons) showed that 79% of those expecting to need nursing home care incorrectly believed that Medicare would pay.
Medicare will pay for long term care in a nursing home only if the following requirements are met:
A. Skilled care is being provided to the individual in the nursing facility. Skilled care is continuous 24 hour per day care provided by licensed medical professionals under the direct supervision of a physician. Only about ½ of 1% of all nursing home residents receive skilled care. Most residents get either intermediate” (4.5% of nursing home residents) or “custodial” care (95% of nursing home residents).
Intermediate care refers to occasional nursing and/ or rehabilitative care under the supervision of skilled medical personnel. It is often referred to as intermittent care and may include physical therapy, occupational therapy, speech therapy, etc.
Custodial care often involves non-medical personnel such as nurses’ aides who provide assistance with the activities of daily living including bathing, eating, toileting, transferring and dressing.
B. The nursing facility is a “Medicare participating” nursing facility. Many nursing homes will not qualify under this requirement.
C. The nursing home care must follow (within 30 days of discharge) at least a three day hospital confinement. Most often those who require nursing home care do not enter directly after a hospitalization. Often individuals are simply aging and finally realize they cannot manage any more at home or in a relative’s home. Since nursing home confinement frequently does not follow a hospitalization, many states now prohibit prior hospitalization prerequisites in long term care policies.
D. In the past in order for Medicare to pay in a skilled nursing facility, the care the individual received had to be “restorative” in nature. The patient had to be getting better. However, on January 24, 2013, the U.S. District Court for Vermont approved a settlement in the case of Jimmo v. Sebelius which states that Medicare provided skilled care may not always have to meet the expectation of improvement. Generally, if an individual meets the four aforementioned requirements (of skilled care, Medicare participating facility, a 3 day prior hospitalization and care that is “restorative” in nature- now a somewhat unclear term-) Medicare will pay all of the costs of the first 20 days and the individual pays $161 for an additional 80 days (in 2016, adjusted annually). (At a current daily nursing home rate of about $250 or more, one obviously cannot depend on Medicare to pay for most of the cost for these other 80 days.) Beyond day 100, Medicare will pay nothing.
Medicare will pay for long term care in a home health care situation only if the similarly stringent and difficult to meet requirements are met. Home health care coverage includes part-time or intermittent skilled nursing care, physical therapy, and speech therapy, through a Medicare Certified Home Health Care Agency. If the patient requires skilled nursing, physical therapy, and/or speech therapy and if the individual is confined to the home and is under the care of a physician, Part A of Medicare can pay for some other services.
A typical individual who requires nursing home or home health care is someone with a physical disability who simply needs help with the activities of daily living -someone who is simply aging. Medicare will not pay for such custodial care. Alzheimer patients, Parkinsonians, stroke victims, and those who have other organically related mental disorders, form another large group of those who need long term care. Typically, since these chronic ailments of aging don’t “get better,” Medicare benefits are not available.
The bottom line is simple: A wise person will not count on Medicare to pay for long term care services.
So what is a person supposed to do? Contact our office to discuss what long term care planning means to you.
Source: This article is an excerpt from LISI Elder Care Law Planning Newsletter #17 (March 3, 2016)
Long Term Care Planning?
True or False
1. ________ ________ I will never end up in a nursing home.
Of those Americans reaching age 65 in any year, 24 percent are expected to spend a year or more in a nursing home. Fifty-seven percent will never enter a nursing home and 19 percent will spend less than a year in a nursing home. Nine percent will spend more than five years.
2.________ ________ An average nursing home costs $5,000 a month.
In Rhode Island, typical nursing homes cost $10,000 a month, or more than $120,000 a year.
3.________ ________ Medicare will pay for any long-term costs I may have.
No. It will pay for up to 100 days of skilled nursing facility care if you meet the certain requirements, including: (1) you must have moved to the nursing home within 30 days of a hospital discharge, the hospital stay having lasted at least three days; and (2) you must receive a skilled level of care. Medicare pays entirely for the first 20 days and everything above a copayment of $114 a day for days 21-100. The copayment is generally covered by Medigap insurance. The general rule of thumb if your coverage is denied or terminated due to the lack of need for skilled care is to ask for the bill to be submitted to the fiscal intermediary anyway. This review costs nothing and may result in coverage.
Medicare pays for home health care on a part-time or intermittent basis. Part-time generally means up to 20 hours a week. You must require a skilled component to your care to get this coverage.
4.________ ________ Medicaid is a program only for “poor” people (not me).
In 2010, the total cost of nursing home care was approximately $342 billion. This amount was paid from the following sources:
- 41% Medicaid
- 20% Medicare
- 15% Out-of-Pocket
- 17% Miscellaneous
- 7% Private insurance
5.________ ________ To qualify for Medicaid I will have to give up my home
False. In Rhode Island you may keep your home as long as you intend to return to live there, no matter whether you really can or do. However, if the house is in your estate at your death, the state will have the right to recover whatever it has spent on your care
6. ________ ________ If my spouse enters a nursing home all our joint savings will have to be spent on his/her care.
False. You are entitled to keep half of your combined liquid savings up to $119,220 for 2016. In some circumstances, you may be entitled to keep more than this amount.
7.________ ________ If I give money to my children I will be ineligible for Medicaid benefits for 60 months.
Maybe. You will be ineligible for 60 months for every penalized transfer. There are some exceptions to this transfer penalty.
8. ________ ________ If I apply for Medicaid, the Department of Human Services and the nursing home staff will reliably guide me through the process.
Yes, and in most cases their help will be sufficient. However, they may not know the intricacies of spousal impoverishment and other rules. They may not be able to advise you on when to appeal a denial. You should be aware that applications for Medicaid require extensive documentation and can be quite time-consuming.
9.________ ________ Legally I can give away only $14,000 to each of my children each year.
You can give away any amount, but have to report gifts in excess of $14,000 per recipient per year ($28,000 if both husband and wife make the gift). The reporting requirement is not an issue for most people because an estate must be greater than $10.9 million in 2016 to be taxable under federal law (In Rhode Island the reporting requirement is when an estate exceeds $1.5 million). MAKING GIFTS AND UNCOMPENSATED TRANSFERS CONSTITUTE A DISQUALIFY TRANSFER UNDER THE MEDICAID RULES AND SHOULD NOT BE DONE UNLESS YOU ARE ASSURED YOU WILL NOT NEED TO APPLY FOR MEDICAID WITH THE 5 YEAR LOOK-BACK PERIOD.
10. ________ ________ I can wait to do long-term care planning until I or my spouse gets sick.
Yes and no. Usually there are things that can be done even if no advance planning steps have been taken. However, you will be much better off if you have taken planning steps in advance. Here are the steps that we recommend that our clients at least consider.
You cannot predict whether you or a family member will require long-term nursing home care. But if we define “long term” as a year or longer, one in four of you will. That means one in four will face costs of more than $70,000-more than one in four couples will face such costs.
Medicare will not pay these costs, which leaves you with three choices:
- Long-term care insurance
Long-term care insurance is great if you can afford it. But follow these ground rules:
- Buy an individual policy, not a group policy.
- Buy home care coverage.
- Get an inflation rider.
- Buy enough coverage.
- Buy at least three years of coverage.
- Tell the agent the complete truth about your current condition and situation.
- Make sure you can afford the policy. This means you are paying for it with 5 percent or less of your income or with money you would otherwise add to your savings. Do not change your current standard of living for the policy, or get your kids to buy it.
Key Medicaid rules:
- Only $4,000 in countable assets.
- Countable assets are everything that you and your spouse own (individually and jointly) other than your home and other noncountable or inaccessible assets. You never need to give up your home in order to qualify for Medicaid.
- The at-home spouse is entitled to retain up to $119,220 in total countable assets. In some cases the at-home spouse can appeal for a higher resource allowance.
- All income of a nursing home Medicaid beneficiary goes to the nursing home, except for (1) $50.00 a month personal needs allowance, (2) the cost of any health insurance premiums, and (3) any allowance for the at-home spouse or minor children.
- The community spouse is entitled to a share of the nursing home spouse’s income if the community spouse’s own income does not meet a minimum guarantee.
- The state may recover whatever it pays for the Medicaid recipient’s care from his or her probate estate.
- The Medicaid application process is long and cumbersome. Do not expect to get sound advice from health care workers, friends, or anyone but an experienced elder law attorney.
- Plan ahead, especially with a durable power of attorney and health care proxy.