A Guide to Nursing Home Planning in Pennsylvania
Will I need long-term care?
A lot of variation exists in the duration and level of long-term care that different people will need.
Nearly 70 percent of people currently turning 65 will need some kind of long-term care.
What does long-term care cost?
COSTS OF CARE:
This varies by region across Pennsylvania from approximately
$69,500 to $135,000.
Median annual cost for a private room in Pennsylvania
How do I pay for the care I need
About 23 percent of all long-term care expenses are paid for out-of-pocket.
About three percent of nursing care expenses are paid by long-term care insurance.
Medicaid covers nearly half of all nursing home costs nationwide.
Be a Pennsylvania resident
Be a U.S. citizen or a qualified non-citizen
Have a Social Security number
Have a medical need for long-term care services
GENERAL MEDICAID ELIGIBILITY:
To be eligible, you must:
There are limits on both income and resources when determining financial eligibility.
The general income limit for Non Money Payment Medicaid is 300 percent of the federal benefit rate, which changes from year to year.
Most types of income are counted, including:
WITHDRAWALS FROM AN IRA ACCOUNT
Most types of income are counted toward the general income limit:
For an individual with income of 300 percent or less of the FBR, the resource limit is $2,000, but in Pennsylvania an additional $6,000 in resources is disregarded.
Most resources are counted, including:
STOCKS & BONDS
NON-RESIDENTIAL REAL ESTATE
How can I protect my assets?
The first strategy is the simplest, but also the riskiest. It requires advance planning to transfer assets before the five-year Medicaid look-back period.
Medicaid examines the five year period before the application, but there is no penalty for gifts or transfers of assets made before the five-year period.
Converting Assets to Income
You can use your assets to pay off existing debts or prepay large bills such as insurance premiums and real estate taxes.
Paying off a mortgage, buying furnishings or buying a new car are all legitimate ways to spend down assets.
Converting assets to income
In this arrangement, the trustor transfers assets such as real property or other investments to an irrevocable trust, with a trusted person acting as the trustee.
If the trust is structured to follow Medicaid’s rules, then the assets will not count toward the Medicaid resource limits.
Talk to an attorney to find out what strategy is right for you.
We give families the peace of mind of knowing the best possible planning is in place.
Speak with an attorney.