An increasingly popular hybrid product combines life insurance with long-term care coverage and offers buyers solutions to a...Read more
Long-Term Care Insurance and Medicaid Planning
- January 24th, 2013
While in large part people who purchase long-term care insurance and those who plan to qualify for Medicaid coverage of long-term care costs fall into separate groups, there are at least two situations where they overlap.
The first group is seniors who cannot afford to purchase lifetime long-term care insurance coverage. These individuals may want to purchase long-term care insurance coverage for five years. They may then transfer assets to family members or to a trust, keeping enough funds so that with the long-term care insurance benefit they can pay for their care for the subsequent five years. After five years have passed, the Medicaid look-back period for asset transfers will have passed, permitting them to be eligible for Medicaid coverage if their other assets have been spent down to the appropriate limit.
Local Elder Law Attorneys in Ashburn, VA
Hale Ball Carlson Baumgartner Murphy PLC
Attorney Samantha Simmons Fredieu is an associate at Hale Ball. Ms. Fredieu graduated magna cum laude from Vermont Law School where she was the symposium editor on the Vermont Law Review, a production editor on the Vermont Journal of Environmental Law, and a member of the Moot Court Advisory Board. She has clerked for...
The Estate Planning & Elder Law Firm PC
Bill founded The Estate Planning & Elder Law Firm, P.C. in 1994. Bill limits his practice to the areas of estate planning and administration, incapacity planning, Medicaid, asset protection planning, and elder law. He is one of (15) fifteen attorneys practicing in Virginia, Maryland and the District of Columbia, ce...
Law Offices of John L. Laster
John Laster is a lawyer licensed to practice in Virginia, Maryland and the District of Columbia. He limits his practice to wealth transfer planning, trusts, wills, powers of attorney, health care decision-making issues, estate administration and related tax, elder law and disability concerns. Listed in The Best Lawyers...
The second group is seniors who are healthy and wish to transfer assets now, but who don't have enough funds to cover five years of care if they had a stroke or other adverse medical event soon after the transfer. These seniors could purchase long-term care insurance to cover the five-year period after the transfer. They may not have enough funds or income to pay the premiums indefinitely, but are able to do so for five years, at the end of which they can decide whether to continue the policy, perhaps with the assistance of children.
For example, suppose a senior owns a home that she wants to protect, but little else. She could protect the home by transferring it into an irrevocable trust. She would then purchase long-term care insurance and hold the policy for five years as she waits out Medicaid’s look-back period. If, for instance, the premiums on the policy are $5,000 a year and the house is worth $500,000, $25,000 is a very reasonable price to pay to protect $500,000.
Last Modified: 01/24/2013