What is elder law?
What is elder law? What is involved? What isn’t elder law?
In this video I’m going to tell you what elder law is and what it doesn’t cover. Elder law is a broad topic.
Hi, I’m Gary. I’m an estate planning lawyer with DeWitt Law Firm and I’ve helped 1000’s of people here in NW Arkansas avoid probate, protect assets, and pass on what they’ve worked so hard to enjoy the peace of mind they deserve.
Many people of think of elder law as strictly dealing with issues of nursing homes and Medicaid. This just isn’t true.
Elder Law Involves a Lot of Law
Elder law covers the intersection of estate planning, contract law, real estate law, Medicaid, Medicare, and a few other areas of law. It also involves protecting people in nursing homes and creating guardianships for those that haven’t planned.
Perhaps more important than getting Medicaid is being prepared for long term care. This is the job of estate planning. If you end up unable to manage your own affairs, then without a plan, your family, not even your spouse, can sign for you. If your spouse needs to sell the house or move assets around, they may not be able to. But, with a plan in place that includes durable powers of attorney, healthcare powers of attorney, and medical information waivers, your family won’t end up in court. Without a plan, your family will end up in court getting permission from a Judge to make those decisions.
Going to court and getting a Judge’s permission to manage is called a “guardianship.” In Arkansas, the powers of the guardian are limited. For example, a guardian cannot sell real estate or other property without a Judge’s order.
Protect Your Home and Money
The second part of estate planning is to protect your home and as much money as possible from being used to pay for long-term care costs. This is done, in Arkansas, by using a special deed that keeps your real estate out of probate. By keeping your real estate out of probate, Medicaid can’t recover their costs from your real estate. And thanks to some changes in the law as of August 2021 in Arkansas, Medicaid can’t “reach through” this special deed to recover their costs.
The third part of estate planning is to pass what you have on to your family in the way you want. Depending on your goals you may need a Will based or a Trust based plan. This isn’t a one plan fits everybody thing.
Part of elder law is reviewing nursing home contracts. If you sign without reading, you don’t know what you are agreeing to. Sometimes they’ll sneak a clause in that you are responsible for the bill if the person in the nursing can’t pay or qualify for Medicaid.
Elder Law to Qualify for Medicaid
Then there is qualifying for Medicaid.
Many people have too much money to qualify for Medicaid, but not enough money to pay for long term care and their spouse to live. A lawyer can help a family reallocate their money to spend as little as possible on long term care and pass on as much as possible to the spouse and family. Don’t let a nursing home tell you that you need to pay it all to the nursing home before your loved one qualifies. By reallocating assets, your loved one can qualify much faster and your family will spend less money.
Medicaid is a “means tested” government benefit. Means tested means that your income has to be under the income limit and your assets (including real estate) have to be under the asset limits. For a couple, they can’t have more than $130,380.00 not including the house and car.
In Arkansas, as of 2021, the income of the person needing care has to be under $2,382. But, the income of the spouse at home can be unlimited.
It’s a strange thing… The assets of both are counted, but only the income of the person in long-term care is counted.
A person or couple can own one home and all adjacent land up to a value of $603,000. In some cases, this is a planning opportunity. They can also own pre-paid, non-refundable funeral plans. Another planning opportunity.
Arkansas is a “half” state when it comes to liquid assets. This means that the spouse at home can only keep half the cash, up to $130,380. So if you have $200,000 in savings, then the spouse at home can have a maximum of $100,000 to qualify.
Most nursing homes will tell you that you need to spend the money to qualify. This isn’t a complete truth. The money can be reallocated to create income for the spouse at home.
But, if your loved one had done some comprehensive estate planning earlier, then getting qualified for Medicaid would be much easier because the real estate is protected already.
Elder Law Conclusion
I hope this helped and that you learned something.