Protection from Aging and Disability

San Diego is a nice, but not inexpensive, place to retire.  The high cost of long-term care has made planning for these needs a critically important issue for most middle class seniors and their families.  In fact, most seniors will likely require some form of long-term care. Sadly,most of us are unprepared for the significant financial burdens it places on our family’s hard earned savings.  Financial devastation looms large for a family facing ongoing care at a rate of $6,000 to $10,000 or even more per month.

Long-Term Care Options

While some seniors are able to afford private pay care, the cost of long-term care will wipe out savings of all but the wealthiest families in a matter of years.  Those who have planned ahead by purchasing long-term care insurance have a degree of certainty and peace of mind, knowing that they have a lesser need to rely on other sources in the future.  Unfortunately, many can’t afford the high cost of long term care insurance or worse, because of age or medical condition cannot qualify for long term care insurance altogether.  If you do have long-term care insurance, you should be aware of what your policy covers.  Many policies have high deductibles or provide for only a short period of care in facility.  In fact, many who have long-term care insurance still have to resort to Medi-Cal to pay for their care.

The other option to pay for care is Medi-Cal.  A joint federal-state program, Medi-Cal provides medical assistance including paying for nursing home care for those who need help in the activities of daily life and who otherwise qualify. 

Medi-Cal and its sister programs in other states are the single largest payers of nursing home bills in America.  The Medi-Cal programs roots go back to a time when life expectancies were shorter and when most families were single earner families which made it much easier for children to take care of their parent’s day to day needs.  It originated at a time when medical and nursing home costs were much less.  Medi-Cal’s purpose was  to provide care for those of very limited income and assets.  Medi-Cal’s qualification rules have evolved into an entitlement and allows individuals to arrange their affairs in such a way as to qualify for benefits.  Medi-Cal benefits can include a limited amount of in home care, medical treatment and includes nursing home care.  In some parts of California a pilot program can even provide assisted living benefits.  These Medi-Cal  benefits are to disabled individuals, and individuals unable to manage certain activities of daily life without help and who meet Medi-Cal’s income tests. Applicants can also be disqualified for having done certain acts at any time up to five years before they apply for Medi-Cal benefits.

Medi-Cal is called Medicaid in many states.  Although the core benefits are the same in each state, the program’s eligibility rules vary greatly in each state .  While Medi-Cal eligibility with respect to long-term care was not difficult in the past, there has been a steady drift towards more complex and restrictive rules for families who want to access care benefits while preserving family assets.. On January 1st 2024 California put into place the largest change to its Medi-cal rules since the 1980s. These rules allow families to preserve inter-generational wealth while qualifying Seniors for in-home care  as well as skilled nursing facility based services.  These new changes open up great opportunities empowering us to help Seniors with asset generated income. 

California also provides the greatest protection for the spouses of seniors requiring care.  Both productive and non-income producing assets can be transferred to spouses without penalty.  This shift of income can reduce a care needing spouse’s share of cost.  A non-Medi-Cal applicant spouse (“Community Spouse”) can hold onto all of their own income and not have it considered available for their spouse’s expenses. During 2023, in families where the spouse needing care has the majority of a couple’s income - the community spouse can claim a portion of the applicant spouse’s income to bring their monthly income up to $3,854 and reducing the applicant spouse’s share of cost. This spousal income share can also be increased through a court filing under amazingly common circumstances. 

California’s recent and newly effective laws require new strategies and approaches to claiming care benefits while protecting family income and assets. Extra care in planning is needed as California little by little gives and releases guidance on how they will interpret and implement the new rules.

The best time to prepare to qualify for these entitlements is before you need them.  The second best time to plan for these benefits is when you or your parents need care – but have not yet spent or given away your assets.  When families take the initiative, their asset based income, savings, investment assets, and homes can be protected and preserved.  Only by taking control of their own situation can the financial impact of aging or illness related care be reduced.

For most Americans being able to stay in their own homes, while receiving help with the necessities of life is much preferable to nursing home care.  Veterans’ Administration dollars are available to help Veterans get the help they need through several different programs including the homemaker program (which is not based on financial need) and for financially needy wartime veterans, aid a cash stipend to reimburse them for care costs.  Both Wartime Veterans and their surviving widows who need help in their homes may qualify.  Unfortunately, most Veterans who served in wartime do not know that their affairs can be arranged to qualify for this entitlement which is also known as a special pension for aid and attendance.  

No one should be required to sacrifice all they have built over their lifetime in order to maintain their dignity and be taken care of when they are old.  Our law firm has the experience and the expertise to help you and yours avoid the financial ruin so often associated with the high cost of in home and residential long-term care.  Contact us today to start the process of understanding the issues surrounding Medi-Cal eligibility and other Benefits and to implement the planning and application process.

In home care is also available to Seniors through a California program administered on a County by County basis.  In San Diego County the largest home care program is administered by In-Home Supportive Services (IHSS).  Seniors who have either have low incomes or can arrange their affairs to lower their incomes (for benefits purposes) can qualify for free care.  Seniors with greater or less flexible income sources can access home care through IHSS after they have spent a co-pay (share of cost) amount on a monthly basis on medical and medical condition related care.  For more details on this program, click this link:  San Diego County Home Care Program.