Aging in place’ is what most of us want—to stay home in our comfortable environment as we age and receive care in the home when needed, rather than moving to a nursing home or assisted living facility.
If aging in place is your goal, then long-term planning needs to be considered, including how the house will function as you age, accommodations for the people who will care for you and how to pay for care, says the Record Online in the article “Start planning now so you can ‘age in place.’”
Many homes will need to be remodeled for aging in place, and those changes may be big or small. Typical changes include installing ramps and adding a bathroom and bedroom on the first floor. Smaller changes include installing properly anchored grab bars in the shower, improving lighting and changing floor covering to avoid problems with walkers, wheelchairs or unsteady seniors.
Choosing a caregiver and paying for care are intertwined issues. Many adult children become caregivers for aging parents, and for the most part they are unpaid. Family caregivers suffer enormous losses, including lost work, career advancement, income and savings. Stress and neglect of their own health and family is a common byproduct.
You’ll want to speak with an elder care attorney about how or if the parent may compensate the child for their caregiving. If the payment is deemed to be a gift, it will cause a penalty period, when Medicaid won’t pay for care. A caregiver agreement drafted by an elder law estate planning attorney will allow the parents to pay without a penalty period. The child will need to report this income on their tax returns.
The best way to plan ahead for aging in place, is with the purchase of a long-term care insurance policy. If you qualify for a policy and can afford to pay for it, it is good way to protect assets and income from going towards caregiver costs. You can also relieve the family caregiver from duties or pay them for caregiving out of the insurance proceeds.
Without long-term care insurance, the next option is to apply for community Medicaid to pay for care in the home, if available in your state. To qualify, a single applicant can keep $15,450 in assets plus the house, up to an equity limit of $878,000 and only $878 per month of income. For a married couple, when one spouse applies for community Medicaid, the couple may keep $22,800 in assets plus the house and $1,287 per month of income. If the applicant or spouse are on a managed care plan, the couple may keep more assets and income.
Another option is spousal refusal, which may allow the couple to keep more assets and income. When an applicant has too much income, a pooled income trust may be used to shelter income from going towards the cost of care. This is a complicated process that requires working with an estate planning attorney to ensure that it is set up correctly.
Self-paying for home care is another option, but it is expensive. The average cost of home health care in some areas is $25 per hour, or $600 per day. When you get to these costs, they are the same as an expensive nursing home.
Planning in advance with careful analysis of the different choices will give the individual and the family the best picture of what may come with aging in place. A better decision can be made, once all the information is clearly assessed.
Reference: Record Online (Aug. 31, 2019) “Start planning now so you can ‘age in place’”
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