Nursing homes can fire residents for non-payment, but they have to follow some guidelines when doing so. Unlike Medicare, which only covers part of the costs of a nursing home for up to 100 days, Medicaid is a joint federal and state benefit that allows you to pay for a nursing home when you run out of money. In fact, Medicaid is the main payer for long-term care for older people and, in most cases, will cover the full cost of care in a nursing home, even if the applicant needs it for the rest of their life. Nursing homes don't accept assets from people who move into them. However, nursing care can be costly and paying for the costs may require you to spend your income, take advantage of your savings and even liquidate your assets.
Neither the nursing home nor the government will foreclose your home to cover expenses while you are under guardianship. However, if you run out of funds to pay for the care you need, your estate assets may be left with your estate assets after your death to cover those costs. Under the Medicaid Wealth Recovery Program (MERP), the state can seize your estate after your death to recover the money that the state Medicaid program spent on your care expenses. If you don't use Medicaid to pay for care in a nursing home, but you die while you owe money to the nursing home, you may be able to file a credit lawsuit against your estate.
In either case, a claim against your estate may require the sale of your home. You can prevent the state or a nursing home from taking your home in a number of ways. The simplest is to make sure that you can cover all of your long-term care expenses so that no claims arise. If that's not possible, asset protection strategies, such as transferring ownership of your home to a trust, can protect you. There are also cases where your home is exempt from recovery claims, such as when your surviving spouse is still living there.
There are several financial strategies that can help you cover the costs of care and protect your assets. You should consult an asset protection attorney to find the best plan for your situation, but the following four strategies may work for you. Because of these drawbacks, you should only rely on Medicaid to cover nursing home costs if your savings, investments, and insurance are insufficient. If you choose Medicaid, consult an attorney who specializes in estate planning and use asset protection strategies, such as gifts and trusts, to secure more of your legacy for your loved ones. Purchasing long-term care insurance in Tennessee can guarantee coverage for the costs of a nursing home, avoiding the need to file claims against your estate after death.
Long-term care policies are often more comprehensive than Medicare or regular health insurance for nursing home expenses. These policies also give you more options than Medicaid for the care facility you choose. If you want long-term care insurance, you'll need to check that you're eligible and budget for premiums. Make sure you understand the options and scope of coverage you have with your policy, as you may have to cover some out-of-pocket costs. Remember that your insurer may increase premiums in the future.
If you want to ensure that your loved ones will receive part of your legacy, you can gift them money or assets before they go to a nursing home. By making financial donations to your loved ones, you ensure that they receive what you want them to have, instead of keeping all your financial assets in your estate, as they could be exposed to claims after your death. If you want Medicaid to help you pay for the costs of a nursing home, donations can also lower the value of your estate and help you qualify. If this is your plan, give these donations more than five years before you apply for Medicaid, as there is a five-year retrospective period during which your transactions affect your eligibility.
Transfers of assets in the five years prior to your Medicaid application may result in ineligibility or a penalty period during which Medicaid benefits don't apply. The length of this period depends on the amount of the donation. Another way to protect the money or assets of your loved ones is to open an asset protection trust account. The assets of a trust are no longer part of your estate. Instead, they belong to the trust, under the administration of a trustee that you appoint.
Putting your assets in a trust keeps them safe from claims against your estate and reduces the value of your estate if you want to apply for Medicaid. In this case, the five-year retrospective period applies just as with donations, so set up your trust as soon as possible. Protecting assets from long-term care costs can be a challenge. You should know your options and how they fit your situation and your state's laws.
The attorneys at Crow Estate Planning & Probate are dedicated to asset protection and estate planning for seniors in Tennessee. If you are a resident of Tennessee and want peace of mind knowing that your assets will pass into the hands of your loved ones, Crow Estate Planning & Probate can help you protect your legacy. The first group of options focuses on remaining in the RCFE, minimizing discomfort for the resident. Perhaps the best route in this regard is SSI (Supplemental Security Income).
If an RCFE resident has run out of savings and meets the SSI income requirements, they may be eligible to receive SSI at the pension and care rate. Once an RCFE resident qualifies for SSI, RCFE will have to accept the SSI maintenance and care fee, known as the non-medical care fee outside the home (NMOHC), as full payment for basic services. If a person runs out of money while in a nursing home, the facility can discharge them for non-payment. However, the person can avoid this outcome by seeking financial support.
Low-income older people who, according to the evaluation, require a level of care in a nursing home are likely to be eligible for Medicaid, which can be used to cover the cost of care in a nursing home. Medicare, Medicaid, veterans benefits and Social Security benefits can help older people and their families pay for care in a nursing home if they don't have money. Some families are concerned about their ability to afford this level of care, as the costs of caring for the elderly continue to rise. Fortunately, there are several payment methods that can help ensure that your loved one gets the care they need. In addition, you can explore other care options for older people that may better meet their needs and are often less expensive than a nursing home.
Nursing homes will continue to house those who have run out of money if they have already started the Medicaid application process. This means that, even if Medicaid hasn't yet been approved, the resident still has the right to continue living in the nursing home. However, it's still highly recommended to plan the Medicaid application process well in advance before money runs out to avoid Medicaid transfer fines that can delay approval of benefits. This highly controlled process of “going broke” is called Medicaid spending reduction. Cost reduction rules are complex, so it is advisable to consult a lawyer specializing in law for the elderly to plan the process in detail.
Seniors can use their Social Security benefits to help pay for the costs of a nursing home, although they are unlikely to cover the full amount. In addition to private funding, long-term care insurance, Medicaid, Medicare, veterans benefits, and Social Security benefits can be used to help pay for nursing home costs. Medicare doesn't cover extended nursing home stays, but it can be used to provide short-term skilled nursing care after an injury or illness. If you don't have money, Medicaid is the main payer for nursing home care, as long as you meet the eligibility criteria.
If you've applied for Medicaid but haven't yet been approved or rejected, you have pending Medicaid status, which means you can start getting care right away in some nursing homes and caregivers. Yes, a nursing home can discharge a patient when Medicare stops paying, but appropriate notice must be given. With more than 1.4 million Americans living in nursing homes across the country, there's a good chance that at some point you'll consider receiving nursing care for yourself or a loved one. In addition to nursing homes, assisted living facilities have different levels of care depending on the resident's needs.
Protect your home and life savings from nursing home costs while getting the benefits you need to pay for care. Even with the highest level of care, assisted living facilities are often much cheaper than nursing homes because they maintain a lower level of on-site healthcare staff and therefore cost less to operate. The following table shows if and in what ways the various payment options can help cover different types of care for the elderly. Although the rules governing nursing homes vary from state to state, in general, these facilities must give 30 days' notice before discharging a person for non-payment.
