One of the most common questions faced by elder law attorneys guiding their clients and families is whether an applicant for long term care benefits under the medicaid program in Florida will cause the applicant or well spouse to have to either sell or lose their home. 

In Florida, an applicant’s primary residence is known as a “homestead.”  An applicant and spouse generally do not have to sell or cause a loss of the homestead by merely applying for the long term care benefits under the medicaid program!

 In Florida, an applicant can not have since November 1, 2007 more than $500,000 of equity in their homestead to qualify for long term care benefits.  However, the homestead is protected from creditor’s claims during the applicant’s and spouse’s lifetimes for an unlimited amount ( there is only a size limitation; not a monetary one for creditor protection).  This protection from creditors includes even the state of Florida!  If an applicant and spouse leave their homestead to anyone deemed an “heir” (for example children and blood relatives are “heirs”) then even those persons, too, get the applicant’s and spouse’s homestead free from claims of creditors.  This means the state CAN’T take your home if you apply for and obtain long term care benefits.

Although the state has estate recovery against certain assets after an applicant for long term care benefits under the state’s medicaid program dies, such rights do not extend to the home!

If you or a loved one is even considering applying for long term care benefits, do not fret or even lose sleep over losing your home.  This is a common misconception. 

It is not unusal to have a will or trust prepared in our office where the client requests that in the event they are not married or if they die without spouse or children that a parent receive some or all of their estate.  This could be a case of “watch out what you wish for” if your parents are entering or already are in their retirement years.

The easiest way to lose a government benefit under social security, including long term care benefits under the Medicaid program which pays for nursing home and some other types of skilled care, is receiving an inheretence!

Certain government benefits programs, such as Medicaid, look at a person’s “countable resources” to determine program eligibility.  The receipt of a gift or inheretence that puts a person over the $2,000 of countable resources ( this isn’t much) will cause an immediate loss of long term care benefits!

The way to correct this problem is to use a Third Party Special Needs Trust.  Leaving your parents or older loved ones property in such a trust allows your gift to supplement the govenment benefits; not supplant them.  Since long term care costs can run over $8,000 per year, merely using this type of trust in your estate plan allows you to still leave a gift and not cause a parent or older loved one from losing their benefits and insurance under the Medicaid program. 

Elder law attorneys spend as much time helping caregivers reduce their stress as they do assisting and advising on long term care planning options for a client.  Research has shown that caregivers are starting to die sooner than the person to whom they are providing care! 

With this in mind, I present to you a Bill Of Rights for Caregivers that was given to me by an alzheimers support group recently.  Hope you caregivers reading this take ALL the advise; without you, the “patient/spouse/loved one” will not get the care they need and deserve.  Here goes:

1.  Take Care of Yourself.  This is not an act of selfishness.  It will enable you to take better care of your loved one.

2.  Seek help from others.  You need to recognize your limitations ( one of my favorite Clint Eastwood lines).  You are not less of a person asking for help.

3.  Maintain facets of your own life that do not include the person you are caring for, just as you would if the person were not ill.  You know you do everything within reason for your loved one; take time for yourself!

4.  To get angry and frustrated.  Let it out!  If you are depressed, let it show and get help if you need it.  You are not weak requesting help.

5.  To reject any attempt by your loved one to (either consciously or unconsciously) manipulate youthrough guilt, anger and depression.  Don’t get sucked in to someone making you feel bad because they do. 

6.  To take pride in the accomplishments you make.  Give yourself a “pat on the back.”

7.  Protect your right to make a life for yourself so you have hobbies and things to do when your loved one no longer requires all your time.

I hope caregivers reading this will take these rights and suggestions to heart.  Have a good day!  Robert Morgan

NPR recently ran a program on the impact long term care costs will have on our aging society.  One of the ways these costs will be (or at least ) are intended to be shifted from the government entitlement programs, such as the Medicaid program, is for baby boomers to purchase long term care insurance.  To help encourage baby boomers to purchase this product, in February, 2006 President Bush signed into law the Deficit Reduction Act (DRA).  A component of the DRA is the Long Term Care Insurance Partnership Plan (Plan). 

 Under the Plan, certain types of long term insurance plans will provide significant economic benefits for those persons purchasing it.  What this Plan does, among other things, is to provide a “dollar for dollar” benefit so owners of this insurance can have more assets in their possession when, and if, they ever require the need for government benefits to pay for long term care, whether at home or in an approved facility.  For example, purchasing $250,000 of long term care insurance benefit allows the policy owner to own up to $250,000 of assets and still be able to obtain Medicaid benefits to pay for their long term care needs!  Since the general rule on assets is an applicant can’t have more than $2,000 of “countable resources” to apply for long term care medicaid benefits, by purchasing a long term care partnership insurance plan of $250,000 will allow an applicant for benefits to keep not just $2,000 but $252,000 of resources!  This means you do not have to be poor to have benefits; you can leave assets to loved ones at your death and not worry the government will take them.

Only a few companies can write these Plans now; however, more will be able to sell them once the state insurance commissioner approves each submitting company’s Plans.  Check with an elder law or estate planning attorney to make sure any policy of insurance you are purchasing is a Plan policy and will give you the “dollar for dollar” benefit.  The requirements for any Plan policy will depend on your age at time of purchase.  Feel free to contact me at 904-268-7227 or at rmorgan@flfirm.com to get any additional information or explanation if you have questions.