It happens every day - your parent may suddenly become disabled by illness or injury.
Long-Term Care and the Elderly
Planning for the possibility that an elderly family member may become disabled is a challenging proposition. Many elderly individuals take steps to plan for the proper passing of their estates to their heirs at death, but fail to take into account the numerous problems that can result from the onset of a disabling illness or injury.
Of particular concern is the possibility that an individual over the age of 65 may need long-term care as a result of the onset of a disability. If steps have not been taken to plan for such contingencies, these persons may be faced with the possibility of funding expensive long-term care costs out of their own estates and risk depletion of funds for themselves and their families.
Although the names sound the same, Medicare and Medicaid are entirely different programs providing different types of benefits to eligible recipients. Medicare is a hospitalization insurance type of program and provides medical benefits to eligible recipients in lieu of private or group health insurance. Medicare is not a "means-tested" program, i.e., eligible participants generally do not have to demonstrate a lack of financial means in order to achieve eligibility.
In order to become eligible for Medicare, an individual must be age 65 or older and eligible to receive Social Security benefits. However, if an individual is under the age of 65 but is eligible to receive Social Security disability benefits, the recipient will be entitled to receive Medicare on the 25th month following a determination of disability.
Benefits provided under Medicare include hospitalization and physician care, among other services. Unfortunately, Medicare does not cover long-term care at this time, nor is it reasonable to believe that it will cover long-term care costs at any time in the foreseeable future. Prescription drug benefits were extended under the Medicare Prescription Drug, Improvement and Modernization Act (MMA) of 2003, but the extent of such coverage remains to be seen.
Medicaid, on the other hand, is a means-tested health care program. Persons qualifying for Supplemental Security Income (SSI) are entitled to receive a Medicaid card by virtue of eligibility for SSI. However, medically qualified applicants are permitted to have only limited “countable resources” and “countable income” in order to maintain eligibility.
The issues involving planning for the long-term care of an elderly individual are extremely complex and there are numerous pitfalls if such planning is not done in a careful and prudent manner. For more information and answers to your questions on this subject, please contact us at steve@jankower.com.
