Healthcare coverage has become one of the central issues in American politics over the last decade or so. While you may not have a real interest in politics, if you are a senior you likely do have an interest is healthcare coverage. For the millions of Americans who do not have private healthcare coverage, or who lose that coverage after they retire, the Medicaid and Medicare programs must fill the gap. Understanding the basics of each program may be beneficial to you if you are deciding which program to apply to for coverage.

• Medicaid
• Federally and State funded
• State administered
• Eligibility criteria as well as benefits can vary by state
• No monthly premiums or participation fees
• Can be small co-payments for some services
• Generally covers more services than Medicare
• Income and asset limits apply based on the household
• Must re-qualify on a regular basis
• Medicare
• Federally funded
• Federally administered
• Guidelines and benefits are the same in all states
• Anyone over the age of 65 (and some under if disabled) qualify for participation
• Must pay monthly premiums
• Divided into parts. One part pays for hospital services, another insurance and yet another prescriptions
• No need to re-apply or re-qualify
• No income or asset limits

Although there are income and asset limits for the Medicaid program, it is important to note that there may be estate planning tools that can be used to help you qualify for the program without losing any of your income or assets. Talk to your estate planning attorney for details.

Pyke & Associates, P.C. is a member of the American Academy of Estate Planning Attorneys.

When you are thinking long-term and engaged in the process of budgeting for your elder years you have to be apprised of all the expenses that you may be facing. All the different facets of elder law are connected, because your estate planning efforts are going to be impacted by your financial decisions throughout your life. If you want to carefully craft your legacy you have to know what your expenses are likely to be late in your life and plan accordingly.

A lot of people are not aware of just how likely it is that they’re going to need long-term care at some point in time. The United States Department of Health and Human Services tells us that three out of every four senior citizens will someday need either in-home care, nursing home care, or the support that is provided by assisted-living communities. This care is extremely expensive, with a single day in a private room in a nursing home in 2011 averaging $229.

Many senior citizens work with elder law attorneys to prepare themselves for Medicaid eligibility in an effort to address long-term care costs because Medicare does not cover long-term care. In fact, Medicaid pays 40% of all the long-term care costs that are incurred in the United States. Two thirds of the Medicaid budget goes toward assisting senior citizens and disabled individuals.

So when you look at the facts, it’s hard to imagine a scenario whereby Medicaid can be cut without seniors being impacted. The House of Representatives passed a proposed budget earlier this year that called for $800 billion in Medicaid cuts; the president has suggested $100 billion in cuts to the program.

As this is being written a congressional committee is hatching a plan to trim $1.5 trillion from the federal deficit over the next decade. Given the fact that the powers that be have already stated that they want to cut Medicaid, one might assume that the “super committee” as it is being called will include Medicaid cuts in its plan.

Many seniors are concerned about how they’re going to pay for long-term care given the realities of the austerity initiatives that are consuming the lawmakers. If you’re one of them, now is the time to take action and arrange for a consultation with an Atlanta elder law attorney so that you can devise a plan that prepares you for all the eventualities of aging come what may.

Pyke & Associates, P.C. is a member of the American Academy of Estate Planning Attorneys.

When you’re budgeting for the latter portion of your life you may want to pay attention to the already high and continually rising costs associated with long-term care. First of all, it is important to understand the fact that it is likely that you will indeed need such care. According to the United States Department of Health and Human Services 70% of people who reach the age of 60 are going to need long-term care at some point in time. Approximately 40% of senior citizens eventually reside in nursing homes.

Last year the average cost for a year-long stay in a private room in a nursing home in America reached in excess of $83,500. This was a 4.6% increase over the 2009 average, and the cost for a year residing in an assisted living community rose by 5.2% to just under $40,000. Men who require long-term care at some point have an average length of stay of 2.2 years; for women it is 3.7 years.

If you apply the length of stay averages to the annual costs and do the calculations it is clear that these expenses are not something to take lightly. And it should be noted that Medicare does not pay for long-term care.

However, Medicaid will pay for long-term care if you can meet the eligibility requirements. There is a $2,000 asset ceiling, but your home (up to $500,000 in equity), your vehicle and some other personal possessions are not counted. So, in an effort to qualify for Medicaid some people give away assets to their loved ones, and this is called a “Medicaid spend-down.”

If you were to do this you have to understand that there is a five year look-back period. You are penalized if you give away assets within five years of applying for Medicaid. The penalty means your benefits are delayed for a period of time that is based on the amount that you gave away and the average cost of long-term care in Fayetteville, Georgia according to Medicaid.

Therefore, it takes long-term strategizing to be prepared to apply for Medicaid. To learn more about this and other ways to prepare for long-term care expenses, take a moment to arrange for a consultation with an experienced Atlanta elder law attorney.

Pyke & Associates, P.C. is a member of the American Academy of Estate Planning Attorneys.

Estate planning is just one of the things that you have to think about when you are planning for the future. It is very likely that there is going to be a period of time before your actual passing and after your active retirement, a stage of life commonly referred to as your “twilight years.”

Many people simply take life at a slower pace during this interim while remaining largely healthy and mentally lucid. Unfortunately, others face some challenges when they reach an advanced age. It is important to be aware of these potential challenges and plan accordingly.

One of the elder law issues that you would do well to take seriously is the matter of financing a stay in a nursing home or assisted living facility. Statistics that have been compiled by the United States Department of Health and Human Services indicate that seven out of every ten senior citizens will eventually need long-term care.

The costs associated with this care are very high and on the rise. Medicare doesn’t cover long-term care, but Medicaid can under some circumstances, and this is something that you would want to discuss in-depth with your elder law attorney.

Another elder law matter that should be addressed is the possibility of dementia striking late in your life. The Alzheimer’s Association states that approximately 40% of individuals who reach the age of 85 are suffering from the disease, and of course Alzheimer’s causes dementia.

It is not the only cause of dementia in seniors however, and it is estimated that half of the oldest old are suffering from dementia, which can make it impossible for its victims to make sound medical and financial decisions. Incapacity planning is key considering the ubiquity of dementia among those who have reached an advanced age and this too is a subject to bring up when you speak with your estate planning attorney.

Pyke & Associates, P.C. is a member of the American Academy of Estate Planning Attorneys.

Many people are under the impression that Medicare will take care of any and all health care eventualities once they reach the age of 65 and become eligible for this entitlement. However, this is not the case when it comes to extended in-home care and nursing home or assisted living  costs.

If you’ve never thought about this issue it is something to take very seriously because the costs associated with long-term care are extraordinarily high and rising. The national average for a year in a private room in a nursing home in the United States in 2010 exceeded $83,000; a year in an assisted living facility would run you almost $40,000 on average. Four out of every 10 senior citizens will spend some time in one of these facilities, and the average length of stay once you begin living in a nursing home is 2 1/2 years. Depending on your resources, expenses of this magnitude can be significant during the latter portion of your life.

One way that people respond to the challenges presented by long-term care is through the assistance of Medicaid. Medicaid started out as a program that was in place to provide a safety net that enabled the impoverished to receive medical care, but it is now commonly used by a broader segment of the population as a way to cover long-term care expenses.

Medicaid is a combined federal/state program so the rules vary slightly state-by-state. But in general, to be eligible for Medicaid you cannot have more than $2,000 of “countable” assets. There are, however, a number of assets that don’t count against you for the purposes of Medicaid eligibility, and these include your house (up to $500,000 in equity), your personal possessions, and one vehicle.

If you are married and you are the healthy spouse, a “snapshot” of your countable assets is taken at the time of the institutionalization of your spouse. You are allowed to keep approximately $109,560 of the countable assets that existed at that time and the Medicare eligibility of the institutionalized spouse, after initial Medicaid eligibility is approved, is calculated based on his or her assets.

As you would imagine, negotiating the Medicaid system is intricate, but it can be used to great advantage and it is something that you may want to discuss with your estate planning attorney the next time that you schedule a consultation.

Pyke & Associates, P.C. is a member of the American Academy of Estate Planning Attorneys.