When one member of a couple needs nursing home care, and if you are asking MassHealth to assist with the monthly bill, then the healthy spouse at home may keep only $113,640 in liquid assets, in addition to her home.  For a younger spouse with many years ahead of her, reducing her liquid assets to only $113,640 can be a very scary proposition.

One option for the healthy spouse to hold onto more of her savings is to convert the liquid into real estate, namely, to make improvements to her home.  Now is the time to make the repairs you’ve been putting off – new heating system, new roof, etc.  Think about what modifications will allow you to stay in your home for as long as possible, like widening doorways and remodeling a bathroom to be easier to use if you have less mobility.  And if you are not planning to stay in your home for much longer, then think about what improvements will help you sell your home.

Another option for helping a healthy spouse hold on to more of her savings is an annuity.  MassHealth permits an at-home spouse to convert her excess assets to an annuity that meets very particular requirements.  You absolutely must work with an elder law attorney if you want an annuity for MassHealth purposes.  Most financial advisors are not familiar with the MassHealth annuity requirements.  And those advisors that do know the requirements don’t want the liability of advising you themselves.

When one member of a couple is entering a nursing home, it is critical for the at-home spouse to meet with an elder law attorney to understand her options.  Adjusting to living alone is hard enough.  You shouldn’t also have to learn how to live with the fear of running out of money.

I hear this a lot.  Let’s be clear on the very basics.  If you’ve watched friends go to a nursing home and “lose the house,” it’s not the nursing home forcing them to sell.  Like all medical providers, nursing homes need to be paid.

Your Medicare and supplemental health insurance policy (ex. MediGap) will pay for up to 100 days – after that, you are on your own.  At that point, some people have the ability to privately pay, and they use their savings, and perhaps even sell the home to pay the monthly bill.  Other people don’t have savings or even a home to convert, and they ask the state to pay the bill (that’s MassHealth, also called Medicaid).

And there is a third category of folks, where there is a spouse living at home who simply can’t afford to use her savings to pay $10,000 – $12,000 per month to the nursing home if she is going to be able to continue supporting herself at home.  She may do some planning so she can ask MassHealth to pay for her spouse’s nursing home care while also being able to retain enough of her assets to support herself at home without living in fear of poverty.

If you are living at home and your spouse needs nursing home care, contact our office so we can help you protect yourself while also making sure your spouse receives the medical care he needs.

Earlier this summer, I made the big trek to Boston, all the way to the State House.  (We are so lucky on the South Shore, we get to take a boat to Boston!)  Along with some colleagues, I testified on some bills that we have before the legislature.  “We” being the Massachusetts chapter of the National Academy of Elder Law Attorneys (MassNAELA).

A friend who works in the State House took this photo of me with
Justice Louis Brandeis!

You may already know that MassHealth has a 5-year “lookback.”  That means that if you ask MassHealth to pay your nursing home bill, they look back over the last five years to see if you have made any transfers, or gifts.  If you have, then MassHealth will deny your application for benefits, the rationale being that you should have known that you would need a nursing home within five years and would need that money.

Technically, the law instructs MassHealth to deny applications where the applicant gave her money away with the “intent” of qualifying for MassHealth.  But what about the situations where people are healthy, don’t anticipate medical deterioration in the near future, and are following the natural instinct to help their kids, for example, with college, a wedding, or tough times?

I was asked to testify on a case I have currently, which I can’t describe much because of client confidentiality.  Let’s just say that Mrs. Beautiful has lived a very difficult life, financially and emotionally.  About three years ago, she won a settlement in a class-action lawsuit, and even though she had so little money of her own, she immediately gave it to her grandchildren for college.  She was determined that they would have a better shot at life than she had.  At that time, her health was fine, with no hint of an upcoming turn.

About six months ago, her health suddenly declined and her mind slipped.  Staying at home didn’t work, and she moved to a nursing home.  She and her husband have very little money, so they applied for MassHealth.  They of course denied her application, since she had given money to her grandchildren.  Despite what the law says, MassHealth didn’t bother to consider whether Mrs. Beautiful gave that money away for the purpose of getting out of paying her future nursing home bill, or if she did it driven by an instinct to do right by her grandchildren, during a time when her health was fine.

MassNAELA’s bill would clarify the law and create a more precise process by which MassHealth must determine whether an applicant transferred assets with the intent of qualifying for MassHealth or whether they made gifts to their family during times of good health, for all the right reasons that families help each other.