Gilroy Estate Planning Attorney: How Will You Pay for Nursing Home Costs?

If you’re eligible for Social Security, you probably know it. If you’re eligible for Medicare, you probably know it. But what about Medi-Cal? How will you pay for the costs of nursing home expenses? Could you be eligible to have Medi-Cal pay those costs? Have you planned ahead to protect your family’s assets?

One of the greatest failures I see as an Elder Law Attorney and Medi-Cal Planning Attorney is the general lack of awareness of what can be done with proper planning. I have had more than one family tell me the sad story that, “we paid over $500,000 for our mother’s nursing home costs before someone told us to go see an elder law attorney.” Wow! That’s a lot of after-tax money that the family didn’t have to spend.

Why does this continue to happen over and over again? People simply don’t know that planning techniques are available if you work with a knowledgeable elder law attorney. A Federal law approved in 2005 changed the eligibility rules, but California hasn’t adopted the new law yet. Yes, the other 49 states have the new rules, but not California. Our rules regarding Medi-Cal eligibility for covering nursing home costs are very different from the other states.

The average length of stay in a nursing home, nationally, is 30 months. If you go to a nursing home, that’s the average length of stay. That’s 2.5 years. In Santa Clara County, the cost of staying in a nursing home is between $11,000 and $12,000 each month. Can you afford that? How will it affect your spouse and family?

I’ve had people tell me that it doesn’t make sense to plan because the people who go to nursing homes die within two months. Really? That’s not true at all. Talk to people who have had a loved one there. Some people are residents in a skilled nursing home for 2 years, 5 years, 10 years, and even longer. The management at one nursing home told me that one resident had been there for over 20 years!

70% of individuals are impoverished within one year of entering the nursing home. 50% of all couples are impoverished within one year of one spouse entering the nursing home. It’s expensive, but that’s the reality of the situation. What can be done to protect your assets and establish some level financial security for the ill person, their spouse, or their family?

Federal law permits Medi-Cal planning, and people who plan ahead can protect their assets for their families. What about the families who think that the parents’ home will go to the kids when both parents die, but then they later find out that the home must be sold to satisfy the deceased person’s debt to the State of California? This happens because people don’t understand the laws and the complicated Medi-Cal rules. Why does this happen? Two reasons: (1) Lack of knowledge as to what can be done to protect the family’s assets, and (2) not having the proper legal documents put in place by a knowledgeable Elder Law Attorney who specializes in the financial side of Medi-Cal Planning and Eligibility for clients.

Lack of proper planning can cost a family hundreds of thousands of dollars. Do-it-yourself options and getting advice from someone other than a qualified elder law attorney can produce devastating results. Unknowledgeable people frequently quote the law from other states, but remember that California law is different from all of the other states.

If you want to protect the elder’s assets, talk with a qualified Elder Law Attorney. I regularly see a lack of planning or planning that won’t work because it wasn’t done right. Don’t let that happen to your family.