Case Study: Will you lose all of your savings to pay for long term care?
After a fall that left her with a broken hip, Kathy, an 88 year old widow, could not be safely discharged to her home after her rehab stay and would instead need to be moved to a skilled nursing facility at a cost of $11,350 per month.
Undertandably concerned about the enormity of the cost and concerned that his mother’s hard earned savings would be depleted too early, her son Marty decided to take action. While he was aware that it was somewhat late since his family had done no planning, he called an elder law attorney to see if his family had any other options. Marty held out hope that there would be some way that the family could get help paying for the skilled nursing care without spending all of mom’s hard earned money.
Mom had done quite well managing the family’s assets after Dad passed away in 1991. Here’s what Marty found after going through her papers:
Resource Ownership Value
House Kathy $105,000
Bank Chkng Jt with Marty $ 22,500
Bank Svgs ITF – 3 Children $ 50,000
Annuity Bene: – 3 Children $ 87,850
Life Insurance Bene: – 2 Children $ 27,000/Cash Surr. Val
$ 40,000 Death Bene
Life Insurance Bene: – 1 Child $ 34,000/Cash Surr. Val
$ 35,000.00 Death Bene
IRA Bene: – 3 Children $145,000
Because Mom had been in excellent health prior to the fracture and fall, Marty is sure that she will live for a long time and will deplete all of her assets.
The Elder Law attorney, listened intently to the family history that Marty provided and took careful notes of Mom’s resources and income. At the end of the meeting he told Marty that all may not be lost, but first he wanted to meet with Mom and Marty’s siblings. A meeting was arranged at the nursing home and Mom clearly expressed her desire to do some last minute planning, even if it meant that she would only be able to pass on a small legacy to her children.
After some complex calculations, the Elder Law Attorney was able to tell the family, that based on Mom’s income, resources and the current cost of her care, Mom could be eligible for full Medicaid after paying $167,750.00 and she would be able to leave a legacy of $303,000.00 for the 3 children.
All is not as it seems, seeking the counsel of a knowledgeable Elder Law Attorney can make a difference in almost every case.