Although not widely understood, under the law a distinction is recognized between ordinary medical care and long-term care.
- Medical care can be defined as skilled care which is needed in order help restore a person back to health. That is, care intended to help cure an illness or condition, or recover from an injury. In this context, medical care can be seen to be essentially rehabilitative. In other words, it is designed to help you “get better” again.
- Long-term care (“LTC”), on the other hand, is skilled care which is required due to conditions for which there is no treatment, cure or remedy which will restore a person to good health, and which prevent that person from being able to independently perform so-called activities of daily living or “ADLs.” Basic ADLs include things like bathing, dressing, eating, mobility in the home, and using the toilet. The need for LTC can arise because of a specific medical problem such as dementia or the effects of a stroke, but it can also result merely from organic processes such as the effects of aging. Either way, such causes are typically chronic or indefinite in duration. As opposed to medical care, the purpose of LTC is fundamentally supportive in nature.
LTC is often provided in a nursing home or assisted living facility, and to a degree has become associated with these forms of in-patient services. But it is important to understand that it is not the type of care or the type of facility which distinguishes LTC from medical care. Rather, the critical distinction is why the care is required, as explained above.
From a planning perspective, the issue is how the cost of any LTC a person may need will be covered, and what impact that will have on the person’s ability to preserve assets for his or her own needs, or those of his or her spouse, dependents and family. This is true because:
- The expectation generally is that anyone who might require LTC will pay for that kind of care from his or her own assets. Neither private health insurance nor Medicare provide any significant coverage for LTC.
- The cost of LTC is very high. For example, a semi-private room in a nursing home in Wisconsin generally costs $8,000 – 10,000 per month or more.
- The only widely available form of government funding for the cost of LTC is Medicaid (a/k/a Medical Assistance or Title XIX). However, Medicaid is a means-tested or “welfare” program, meaning that a person will not become eligible for it unless that person and his or her spouse (if any) qualify by meeting both income and asset limits to show that they are impoverished according to government criteria.
The point is that without proactive planning which carefully structures both legal and financial decisions, an individual (and his or her spouse, if applicable) may later be compelled to address rules intended to require that the vast majority of the person’s (or couple’s) assets be depleted before Medicaid coverage will be available. Not only might that deprive the person who requires LTC and/or his or her spouse with the resources needed for self-support and a proper quality of life, it will also likely eliminate any ability to leave an inheritance for children, grandchildren, or other intended beneficiaries.
If you or your family would like to be proactive and structure your long-term planning with Medicaid eligibility in mind, be aware that time is not on your side. The longer you wait, the more limited your options will usually become. Contact us today to discuss how we can help.