Skip to Main Content (717) 697-3223

Five Myths About Nursing Home Costs and Estate Planning – Keystone Elder Law – Mechanicsburg PA

As we observe Elder Law Month in May, it seems appropriate to share some common misunderstandings or myths about long-term care.  This article challenges general sensibilities of planning for and paying for long term care.  The role of an elder law attorney is to a client-centered advocate so please read on to dispel these common myths.

Myth #1:  A married couple must have spent at least half of everything they have except for around $120,000 before the government will pay for their care; single persons must spend everything that he or she has on nursing care before getting government aid.
Truth:  Although nursing homes have neither a legal duty nor self interest in advising those admitted, the myth is not true.

Lessons from Myth #1:  There are several accepted opportunities to spend money on items other than nursing care, such as home improvements, debt retirement, an updated vehicle, and prepayment of funeral arrangements.  A diligent elder law attorney will know how to utilize a Medicaid-compliant annuity to preserve extensive assets without losing them to the cost of care.  When applied, these methods are helpful and completely permitted under the law.  There are those who believe these opportunities should be kept secret and that an attorney should not assist a client in taking advantage of these legally permitted strategies to save assets.  This may or may not be true however, anyone is free to lobby to change the laws should they not agree with them.  Much like an accountant uses strategies to help a millionaire client minimize federal income taxes, an experienced elder law attorney uses legal strategies available to help middle-class clients with once-in-a-lifetime savings.

Myth #2:  If we can’t pay the cost of care, the nursing home will take our family’s house.
Truth:  Nursing homes want to be paid  money and will not take your family home.  If you cannot afford to pay, the state will use federal Medicaid money to pay the nursing home, as long as the family had run out of money the “right” way.  If a loved one does receive federal Medicaid to pay for the nursing home and then passes away, the state may attach a lien against the estate to recover the money that the state paid.  This is referred to as “estate recovery.”

Lessons from Myth #2:   A competent elder law attorney knows how to: 1) Help the family run out of money the “right” way as timely as legally possible so that the adult children cannot be sued for payment by a nursing home; 2) Use what exceptions and opportunities exist to preserve the family home when possible; and 3) Avoid estate recovery liens by the state.

Myth #3:  All nursing homes are alike and our family has promised never to use one.
Truth:  All nursing homes are not the same. Different facilities offer various levels of care for the frailties of aging and dementia.  There is no one best facility for everyone and there is no facility that should be avoided at all costs by everyone.  Your family most likely did not intend the outcome from the words that were promised.

Lessons from Myth #3:  What our loved ones really want is for us to promise and constantly reassure them that they will never be cast off or abandoned and that they will get the best care possible.   For example, very few families can afford the type of 24/7 home nursing care that some stroke victims need; anything less than that level of care might not be as good as care given by a facility with adequate family observation and advocacy.   When home-care is provided over too long a time period by a well spouse, often both spouses end up needing more care than would have been needed with early intervention.  This can be especially true in relation to the care of a person who suffers from Alzheimer’s disease which can cause a significant change in personality and behavior.

Myth #4:  Because I love my children equally and it is important that they get along after I am gone, I should appoint them to act together as my legal Power of Attorney agent.
Truth:  Occasionally, even siblings with the best of intentions have serious disagreements.  Even when they agree, it is not necessary to have two people give formal approval when the signature of just one can be acceptable.

Lessons from Myth #4:  It is not always advisable to have two primary agents.  When adult children cannot agree, disagreements can escalate to a guardianship action and/or courtroom battle.  Important health care decisions can be delayed which can lead to further problems.   If a parent cannot decide among children who should be agent and the children cannot decide among themselves, a coin flip is a better solution than co-agency.  The children can still consult each other.  There is no law that prevents the primary agent from making a call to another sibling to get a second opinion before signing a paper to implement a decision.  That stated, every agency appointment should have a backup agent in case the primary agent is unwilling or unable to act.

Myth #5: We did our last will and testament long ago and our situation has not changed.
Truth:  Commonly, the last will and testament leaves everything to one’s spouse and thereafter, money goes to the children.  Such a document can work fine until someone shows signs of early stage dementia or is suddenly in a nursing home.  For example, let’s say that one spouse is in a nursing home and receiving financial assistance through a government benefit.  If the spouse that is not in the nursing home passes away and the will leaves assets to the spouse that is in the nursing home, it would not be an ideal situation.  Inheriting assets could render the spouse in the nursing home ineligible for government assistance and then the assets would have to be spent on their care before they were eligible again.  Additionally, those assets that were left to the spouse in the nursing home would be lost to the costs of nursing care.

Lessons from Myth #5:  When facing long-term care, a fundamental element of any asset preservation strategy is to make changes to the will.  It is neither necessary nor possible to cut the spouse in the nursing home out of the will entirely but specific language can provide for that spouse, preserve assets, and comply with state laws about minimal spousal election.  If early stage dementia or other diseases occur, an elder law attorney’s help should be obtained while the individual’s legal capacity remains intact so that updates can be made to the will, power of attorney, and any other estate planning documents.

Non Mythical and Truthful, Concluding Lesson:   See a care-oriented elder law attorney to make a plan to get the best care and preserve assets.  It is never too late, but sooner is better than later.

David D. Nesbit, Attorney