Elder FAQs

As we age, many of us are faced with difficult and important decisions regarding our healthcare and our financial well—being. Elder law attorneys represent, counsel and assist the elderly and the disabled with legal issues ranging from estate planning to long—term care planning (planning for assisted living or nursing home placement).

Paying for Nursing Care & Asset Preservation:

One of the most common fears that senior citizens have is that they will need some sort of nursing home care and that their entire life savings will be wiped out trying to pay for this care. Given the fact that the average nursing home in North Carolina currently costs $4,200 per month, there is good reason to worry. Moreover, recent studies indicate that nearly half of us will require some long-term care (either assisted living or nursing home care) at some point in our lifetimes.

Typically, there are five ways to pay for nursing home care; (1) private pay, (2) long-term care insurance, (3) Veteran’s benefits, (4) Medicare, or (5) Medicaid. Unfortunately, very few people qualify for Veteran’s benefits and even fewer seniors are able to afford long-term care insurance. At most, Medicare will only cover a portion of nursing home costs (and after 100 days, Medicare does not cover nursing home expenses). Therefore, most people who enter a nursing home will eventually have to rely on either Medicaid or privately paying the full cost of the facility.

Medicaid Planning:

Since Medicaid rules are very complex, many families fail to take full advantage of the program. Because the act of filing a Medicaid application with the local Department of Social Services can have a significant effect on the amount of assets that you may keep and the amount of time before you can become eligible for Medicaid, it is often wise to consult with an elder law attorney. With the intricate rules on transfers of assets, seniors can often avoid costly problems and preserve their life savings by learning the rules of Medicaid eligibility and using appropriate planning techniques before the need for nursing home care actually arises.

Estate Preservation:

Since 1996, federal law has authorized the State of North Carolina to seek reimbursement for Medicaid benefits paid during your lifetime by suing your estate after you die. Through “estate recovery,” the State is now filing claims against the estates of most nursing home residents who pass away. Thus, assets that may not have made an elderly person ineligible for Medicaid, may be lost to the government. For example, a rental property owned by a Medicaid recipient could have a lien placed on it once the elderly person dies. An experienced elder law practitioner can evaluate the potential estate recovery consequences that apply in your situation and may be able to minimize or even eliminate the loss of assets from estate recovery.

A recent change in North Carolina law has expanded the original estate recovery law and now permits the state government to pursue property owned by disabled people who receive certain Medicaid funded in—home assistance. Again, it is important to evaluate how this rule could affect you and engage in appropriate planning to deal with the situation.

Essential Planning for all Persons:

At a minimum, every person in North Carolina should have the following legal documents:

A Last Will & Testament: to direct how your estate should be distributed after you die;

A Durable Power of Attorney: to appoint someone to handle your business and financial affairs in the event that you become either physically or mentally incapable of doing so for yourself; and

A Health Care Power of Attorney: to appoint someone to handle important healthcare decisions, such as the choice of doctor or whether to authorize experimental treatment, in the event that you become either physically or mentally incapable of making such decisions for yourself.

Failing to have the estate planning documents listed above can lead to the expensive and burdensome need for a Guardianship (see below). And for seniors or people with disabilities, standard estate planning is not enough. For example, many seniors have Wills that leave all of their assets to the spouse in the event that they pass away. However, such a Will may actually risk giving a significant part of your estate to a nursing home if your spouse were to be living in a nursing home when you died. Therefore, advanced estate planning in the form of a testamentary discretionary trust for the benefit of the surviving spouse is often a far wiser choice.

Another common problem faced by seniors is having a Durable Power of Attorney that is not customized to deal with the problems that elderly people are most likely to face. We frequently review powers of attorney that were drafted by general practice lawyers who have little or no knowledge of basic healthcare law. As a result, many families are surprised to find that a parent or loved one’s power of attorney does not have the powers needed to protect assets from estate recovery and will not permit re-titling assets to obtain Medicaid eligibility. Even worse, some powers of attorney expose seniors to unnecessary negative tax consequences.

Elder Law attorneys use a ”multi—disciplinary” approach to help clients and their families make health and financial decisions in a caring, compassionate way that preserves individual dignity. In doing this, an elder law attorney must have significant knowledge of the social, psychological, medical and financial needs that most seniors and disabled persons have. Any attorney that advises clients about nursing home issues should have detailed knowledge of both state and federal Medicaid rules and regulations.

Guardianship (Involuntary Planning):

When a person is no longer able to make his or her own financial or medical decisions, then a guardianship may be the only way to manage their affairs. A guardianship is a protective arrangement by which the local court gives someone the authority to make decisions involving another person’s care and/or finances. For example, a person suffering from Alzheimer’s Disease may be unable to reasonably care for himself or manage his finances. In such cases, we can assist the family by preparing a legal petition with the court, obtaining evidence in support of the guardianship and representing the family until a guardianship is approved by the court. Afterwards, we may assist the court-appointed Guardian with Medicaid planning or other actions needed to help preserve the assets of the incapacitated person.

Additional Information:

Serving:

Alleghany Ashe

Carrabus

Davidson

Davie

Forsyth Iredell

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