Long term care expenses are going up. With nursing facilities averaging around $8,000 a month in cost, it is not surprising why this is a concern for many.  Needing care at the cost of your life savings can be heart wrenching.  Going without care shouldn't be the compromise.  Planning ahead can soften this shock.  

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The Federal and State governments have provided a safety net for individuals who are in need of long term care but cannot afford it. Medicaid, known as Medical Assistance (MA) in Minnesota, covers long term care either in a facility or at home, for those who qualify. MA can be a challenge to those who don't know the rules.

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MA requires a single individual reduce their assets to no more than $3,000 prior to qualifying for coverage. Couples, where one spouse is living at home, are allotted a greater sum of $3,000 for the spouse requesting coverage and $148,620 (2023) in assets for the spouse at home. This number, in most circumstances, excludes the primary residence, one vehicle and personal property. Planning ahead can reduce the panic that comes when significant care arises. 

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MA imposes a penalty for assets given away for less than they are worth. All gifts made in the 60 months leading up to the application are reviewed. Gifting includes the transferring of a car, house, or investment account without being paid for it's value; as well as, includes presents given for holidays, birthdays, and weddings. These penalties can result in massive financial costs for the applicant, and their spouse.

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Though MA isn't for everyone, it's rules are a reference point for most when it comes to planning for care. Strategizing on how to maximize income and spend assets should be planned with all of your advisors (i.e., financial advisors, insurance agents, CPAs, attorney). 

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