Medicaid or Private Pay…there are options

We met with Hallie Zobel to discuss the financial aspects of my parents going into an assisted living facility (ALF). First the topic was Medicaid. Many nice long term care facilities which include independent living, assisted living and skilled nursing, have Medicaid units among the private pay rooms. Hearing the term Medicaid, one might think of destitute individuals who qualify for Medicaid benefits due to their economic issues. There is also a portion of Medicaid called the Institutional Care Program (ICP) which, in Florida, is overseen by the Department of Children and Families (DCF). In order to qualify, elders must be 65 years of age or older; their home must be worth less than $500,000; they must have less than $2,000 cash. Their home, car, wedding and engagement rings are not included in their assets. Their gross monthly income must not exceed $2,022 ($4,044 for a couple). The spouse of the individual applying for ICP benefits can hold assets in the amount of $109,560 in his or her name, so it would behoove mom to have her own bank account and transfer any cash assets over to her name. If the individual has more than the $2,000 in cash assets, there are ways to distribute the funds and, basically, hide them. Since 2007 the laws have changed gifting. Used to be one could sign over large amounts of money and properties to family members and not have it counted towards their cash assets. This can still be done but it has to be done more than five years prior to their application. Hallie listed many ways to divert funds legally so the person can qualify; loopholes with names like Qualified Income Trust, Special Needs Trust, Medicaid Asset Protection Trust. They could also purchase an adult child’s home and live in it one full year to qualify. Spending down is also an option if the money goes towards upgrades on their home – renovating a kitchen, bathroom, adding a room, etc. (A good resource for questions about elder care issues is Caring.com.)

Once we determined that neither mom nor dad were needing a Skilled Nursing Facility yet or an ALF memory care facility, we broke down their monthly income to see if they could afford a place where they could live together in a small apartment as part of an ALF scenario. Since dad is a Foreign War Veteran, he would qualify for a program called Aid and Attendance through the Veterans Administration. The VA assists with funding a stay in an ALF along with surviving spouse benefits – these benefits amount to around $1,500 to $1,900 per month. That’s a nice chunk of $$ to help with monthly ALF expenses.

We were told about a few facilities in our area which are quite nice but don’t require a large buy-in from the potential resident. In a perfect world our parents would be in an ALF sharing a small apartment, having meals supplied in a central dining room, with activities available along with opportunities to have social encounters upon stepping outside the apartment. Of course, medical care being close by in case of need would be great.

All of this is not relevant, however, if we cannot convince dad that a move like this would be beneficial to both he and mom. Mother seems to be amenable to the idea but dad will be another story. They have such a nice condo on Lake Howell with a killer view and central location. Dad likes to take 2 mile walks which would be safer if he weren’t alone. It would be great for them both to stay in their own house but the dementia will probably preclude them from that scenario in the not too distant future.

Next on our agenda is to try and talk dad into signing over a Power of Attorney to Patty or I. He drifts in and out of thinking that we are all out to get his money and are just waiting for him to die. That, of course, is not the case but one cannot argue with dementia. More to come…

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