Are You Prepared to Age in Place?

Are You Prepared to Age in Place?

If aging in place is your goal, then long-term planning needs to be considered, including how the house will function as you age, accommodations for the people who will care for you and how to pay for care, says the Record Online in the article “Start planning now so you can ‘age in place.’”

Many homes will need to be remodeled for aging in place, and those changes may be big or small. Typical changes include installing ramps and adding a bathroom and bedroom on the first floor. Smaller changes include installing properly anchored grab bars in the shower, improving lighting and changing floor covering to avoid problems with walkers, wheelchairs or unsteady seniors.

Choosing a caregiver and paying for care are intertwined issues. M any adult children become caregivers for aging parents, and for the most part they are unpaid. Family caregivers suffer enormous losses, including lost work, career advancement, income and savings. Stress and neglect of their own health and family is a common byproduct.

You’ll want to speak with an elder care attorney about how or if the parent may compensate the child for their caregiving. If the payment is deemed to be a gift, it will cause a penalty period, wherein Medicaid won’t pay for care. A caregiver agreement drafted by an elder law attorney will allow the parents to pay without a penalty period.   However, the child will need to report this income on his or her tax return.

Self-paying for home care is another option, but it is expensive. The average cost of home health care in some areas is $25 per hour, or $600 per day.   Self-pay, depending upon the number of hours needed each day, can be as, or more, expensive that paying privately for skilled care in a nursing home.    To offset the high cost of private pay care, there are several options that include long term care insurance and qualifying for Medicaid, which is called MassHealth in Massachusetts.

The best way to plan ahead for aging in place, that is paying for care while staying at home, is with the purchase of a long-term care insurance policy. If you qualify for a policy and can afford to pay for it, it is good way to protect assets and income from going towards long term care costs. You can also relieve the family caregiver from duties or pay them for caregiving out of the insurance proceeds.

Without long-term care insurance, the next option is to apply for community Medicaid to pay for care in the home, if available in your state.  In Massachusetts, Massachusetts Medicaid—called MassHealth—operates the Frail Elderly Waiver specifically to help residents who require nursing home level care to receive health care and ongoing support services in their homes or community living residences instead of in a nursing home.  The objective of this program is two-fold. Lawmakers’ intention was to provide residents with an option regarding their long-term care. Additionally, by preventing the placement of frail individuals in nursing homes, the state saves significant financial resources as the burden of caring for these individuals is shifted onto family caregivers. Despite this, many families and care recipients still prefer this model as it allows them to age in their homes or the homes of other family members.  The Frail Elderly Waiver is operated by the Executive Office of Elder Affairs (EOEA). There is a version of this program called the Community Choices Program that provides more hours of services to those at immediate risk for nursing home placement.

Eligibility for this waiver depends on the age, location, functional ability, and financial status of the applicants. Candidates must be a minimum of 60 years of age. However, those between the ages of 60 and 64 must be physically disabled. All applicants must require the level of care provided in nursing homes, yet they should be willing to receive the care at home. The cost to provide that care cannot exceed what it would cost in a nursing home.

To be eligible for the HCBS Waiver, persons must be financially qualified for MassHealth Medicaid. The 2019 income limit is $2,313 per month for an individual. The income of married couples with both spouses as applicants is considered separately. This means each spouse is allowed up to $2,313 / month in income.

Fortunately, Massachusetts also maintains an alternative method to qualify if one is over the income limit. Individuals who have very high medical expenses can qualify through the Medically Needy pathway for MassHealth. As of 2019, individuals should not have more than approximately $552 in monthly income after medical expense deductions, and couples are limited to approximately $747 after subtracting medical expenses.

MassHealth also considers one’s countable assets, which includes cash, bank accounts, certificates of deposit, and life insurance policies with a face value over $1,500. The limits for an individual and a married couple (both spouses applying for services) respectively are $2,000 and $4,000. However, as with the income limits, there is flexibility. When only one spouse of a married couple is applying, the asset limit for the other spouse is up to $126,420 (as of 2019). Their home, if owner-occupied, is considered exempt up to a value of $878,000 in 2019. There are also other exempt assets, such as a vehicle, funeral trusts, and personal valuables.

As with other state Medicaid programs, the applicant’s five-year financial history is considered to prevent the applicant from giving away his / her money to qualify. (This is called the Medicaid Look-Back Period.) A professional,who is familiar with state Medicaid rules, such as an elder law or elder care attorney, can determine the exact limits and the best structures for resources to ensure a qualification, while also preserving some of the couple’s net worth for the healthier spouse.

Planning in advance with a careful analysis of the different choices tailored to your specific goals will ensure that you fashion the optimal blueprint.

Reference: Record Online (Aug. 31, 2019) “Start planning now so you can ‘age in place’” and www.payforseniorcare.com