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LTC Bullet:

LTC Insurance Gets Short Shrift in Favor of Medicaid

Monday July 12, 1999


National Academy of Elder Law Attorneys (NAELA) board member Joyce M. Collins gives LTC insurance short shrift in favor of Medicaid planning (the process of shifting or transferring assets in order to qualify for Medicaid-financed long-term care benefits) in her article "Estate Planning for the Elderly" in the current issue of NCJW (National Council of Jewish Women) Journal (Vol. 22, No. 2, Summer 1999).

Collins' article, excerpted below, exemplifies the all-too-common approach of many attorneys in the field. While long-term care insurance is mentioned, the focus is clearly on planning for Medicaid-financed care. Moreover, the article makes clear, despite the Medicaid planning bar's protests to the contrary, that Medicaid planning is promoted as an advance planning tool and not just as an option in a crisis situation.

Particularly troubling is the fact that Collins' article is written as a primer for women who may be totally unfamiliar with the estate planning process--women who might not otherwise learn of the many downsides of welfare-financed care (including problems with access, quality, reimbursement, discrimination, and institutional bias) before ignoring the risk, avoiding the premiums for insurance, and eventually hiring a Medicaid planner to qualify them for welfare. Ms. Collins' incomplete discussion of LTC is a disservice to her readers.

"Estate Planning for the Elderly"

"Nursing home care may be paid for by the individual, through long-term care insurance benefits or, if the person qualifies both medically and financially, by Medicaid. Medicaid is a Federal program that is run, and partially funded, by each state.

"Although eligibility for Medicaid includes very restrictive financial requirements, there are ways that an individual or couple can, and should, protect some assets. In cases where one spouse enters the nursing home and the other spouse remains at home, there are many ways to protect assets to prevent the community spouse from becoming impoverished. Although some Medicaid planning may be possible on short notice, being prepared and planning well ahead of a crisis will allow for the protection of assets and give peace of mind. Asset protection and financial planning in anticipation of nursing home care is a very complex area of law and the services of a knowledgeable elder law or estate planning attorney should always be utilized."