1. 6/9/2018
ESTATE Planning for the Special Needs of Disabled AdultS, and Elders Facing Long-Term Care Costs
Caring for Caregivers
November 15, 2016
Presented by Donald D. Vanarelli, Esq. _______________________________________
Recipient, Lifetime Achievement Award By New Jersey State Bar Ass’n, Elder and Disability Law Section Certified Elder Law Attorney Accredited Veterans Attorney Founding Member, Assn. of Special Needs Planners Named to the NJ “Super Lawyer” list for 10 yrs,

2. Asset Protection
6/9/2018
Long Term Care
Long Term Care refers to the kind of care a person needs when he or she is unable to care for himself or herself due to disability, frailty or cognitive impairment.
Long Term Care is sometimes called Custodial Care - assistance with activities of daily living (ADLs) - bathing, eating, dressing, toileting, continence and transferring - or supervision made necessary because of severe cognitive impairment.

3. The Cost of Long Term Care
Asset Protection
6/9/2018
The Cost of Long Term Care
Average cost of 24 hour Home Health Aides provided by an agency - $5,500 per month, or $66,000 per year.
Range of costs charged by Assisted Living facilities - $5,500 - $7,500 per month, or $66,000 - $90,000 per year.
Typical cost of Nursing Home care in New Jersey - $10,000 per month, or $120,000 per year.

4. Who Pays For Long Term Care?
Asset Protection
6/9/2018
Who Pays For Long Term Care?
1. Private Pay %
2. Medicaid %
3. VA Benefits 4%
4. Medicare 2%
5. Long Term Care Insurance 1%

5. Overview of Government Sources for the Payment of Long Term Care Costs
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6/9/2018
Overview of Government Sources for the Payment of Long Term Care Costs

6. Long Term Care Costs Covered by Medicare
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Long Term Care Costs Covered by Medicare
1. Home Health Care
2. Nursing Home Care

7. Medicare - Home Health Aides
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Medicare - Home Health Aides
Covers up to 100 home visits per “spell of illness”.
Preconditions to payment: prior hospital stay of at least 3 days and home health care initiated within 14 days of discharge.
Beneficiary must be homebound and need skilled nursing care, physical or speech therapy, NOT custodial care.

8. Medicare Payment of Nursing Home Care
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6/9/2018
Medicare Payment of Nursing Home Care
Immediate prior hospital stay of 3 days
Admitted to NH within 30 days of hospital discharge
Covers skilled nursing care or rehabilitation only, NOT custodial care.

9. How Much Does NH Medicare Pay?
Asset Protection
6/9/2018
How Much Does NH Medicare Pay?
Maximum Coverage days
Day Medicare pays 100% of covered charges
Day Medicare pays all covered charges, except coinsurance amount. Year 2016 coinsurance payment = $161.00/day, or about $4,900/month
Day on your own

10. Medicaid Joint Federal and State Program.
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Medicaid
Joint Federal and State Program.
Provides medical assistance for financially eligible persons who are aged, blind or disabled.

11. Asset Protection
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Income Limits
Income - all income is counted in determining eligibility.
Income cap - Medicaid programs have an income cap. In 2016, the cap is $2,199/month. Income above the cap must be transferred to a Qualified Income Trust each month.

12. Asset Protection
6/9/2018
Resource Limits
Countable resources - all assets in the sole name of applicant, in the sole name of spouse, or in joint names, either with the spouse or another person. Includes pension and retirement assets of BOTH the applicant and spouse.
Resource Limits - $2,000 for an individual and $3,000 for a couple.
Excess resources - must be spent down.

13. Transfer of Resource Rules
Asset Protection
6/9/2018
Transfer of Resource Rules
To prevent gifting of assets, Medicaid imposes a “penalty period”, or period of ineligibility for Medicaid, for all gifts made within the “lookback period”.

14. Comparing Medicare and Medicaid Coverage for Long-Term Care Costs
Asset Protection
6/9/2018
Comparing Medicare and Medicaid Coverage for Long-Term Care Costs
Medicare: covers costs of home health aides and nursing homes for those who need skilled nursing care or therapy, but for a limited time only. No financial limits.
Medicaid: covers home health aides, assisted living facilities and nursing homes, but only for the aged, blind and disabled who need custodial care and who meet strict financial limits.

15. Overview of Major VA Benefit Programs
Asset Protection
6/9/2018
Overview of Major VA Benefit Programs
Service-Connected Compensation
Disability compensation is a monetary benefit for veterans who are disabled by an injury or disease that was incurred or aggravated during active service.
Needs-Based Pension
Pension is a monetary benefit for veterans who (1) are disabled (not service-connected) (2) have low income and resources, and (3) served during a period of wartime.

16. Basic Eligibility Criteria for VA Improved Pension Program
Asset Protection
Basic Eligibility Criteria for VA Improved Pension Program
6/9/2018
All of the following criteria must be met before a veteran or widow(er) of a veteran can receive Improved Pension benefits:
a. The veteran must have served at least 90 days of active duty service, one day of which must have been during a wartime period;
In general, wartime is:
World War I
World War II – Dec. 7, 1941 – Dec. 31, 1946
Korean War – June 27, 1950 – Jan. 31, 1955
Vietnam War – Aug. 5, 1964 – May 7, 1975
Gulf War – August 2, 1990 through date to be set

17. Basic Eligibility Criteria for VA Improved Pension Program (cont’d.)
Asset Protection
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Basic Eligibility Criteria for VA Improved Pension Program (cont’d.)
b. The veteran must have received a discharge other than
dishonorable;
c. The claimant must have limited income and assets; and,
d. The claimant must be permanently and totally disabled,
or be over age 65.

18. VA Improved Pension Program: Three Tiers of Benefits
Asset Protection
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VA Improved Pension Program: Three Tiers of Benefits
1. Low Income Pension
2. Housebound Benefits
Aid and Attendance Benefits
Housebound benefits and Aid and Attendance benefits are supplements paid in addition to the basic Low Income Pension to certain veterans to cover the additional costs of care for their added disabilities.

19. Asset Protection
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Net Worth: Standard
The VA considers the net worth of the individual seeking benefits, excluding the value of the person’s home, furnishings, and car. The standard as to whether a person will be eligible for benefits is whether the person has “sufficient means” to pay for his or her care.
Assets that are counted toward the “sufficient means” analysis include bank accounts, certificates of deposit, money market accounts, investment accounts, annuities, retirement accounts, life insurance cash surrender values, etc.

20. Net Worth Test STANDARD: Sufficient Means to Self-Pay
Asset Protection
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Net Worth Test
STANDARD: Sufficient Means to Self-Pay
Sufficient Means: A commonly used measure is $80,000 or less for a married couple, $50,000 or less for a single veteran.
Age Analysis: Age vs. Asset test

21. VA Transfer of Resources Rules
Asset Protection
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VA Transfer of Resources Rules
No look-back period
Compare Medicaid with VA Pension rules regarding transfers of resources. But, note difference in VA Nursing Home Rules.

22. Thank You For Your Attention
Asset Protection
6/9/2018
Thank You For Your Attention
Questions or Comments?