The long-term-care ripple effect

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Let’s assume that Mom and Dad are still living at home with round-the-clock care. After a number of years, their asset spend-down will be enormous. Now let’s assume that the parents have spent all their money on round-the-clock care and the children are digging into their retirement savings to cover the costs. Let’s also assume that their home won’t sell quickly, as is often the case in today’s market. This is a predicament that weighs heavily on both generations of family members, both financially and emotionally.

Is there another alternative?

Yes, there is another alternative. The first step is to get Mom or Dad into a nursing home. In our example, Dad goes first. At that point, assuming that the parents have done the proper Power of Attorney paperwork earlier in their lives, it will be easy to transfer their sole remaining asset, the family home, from Dad to Mom because Mom will continue to live in the home for a short while.

Next, we apply for Medicaid for Dad. We are permitted to transfer the home from Dad to Mom, as this is an allowable transfer for Medicaid purposes. Also, the home is a non-countable asset because Mom is living in the home. Once we get Dad approved for Medicaid, we can then begin to focus on Mom. If Dad is on Medicaid, whatever assets Mom has remaining could be made available solely for her and not be spent on Dad’s nursing home care. This is an important part of the solution.

Next month, I will talk about how to get Mom on Medicaid and still preserve some of the assets.

To contact me, call 847-292-1220, e-mail or visit


About Anthony B. Ferraro

Anthony B. Ferraro is the founder and managing member at the Law Offices of Anthony B. Ferraro. He received his Bachelor of Science degree in accountancy from DePaul University and his Master of Science in taxation. After receiving his CPA designation in 1978, he enrolled in law school, earning his Juris Doctor in 1983 from De Paul University. An elder law practitioner, his practice areas include Medicaid planning and applications, guardianship, probate & trust administration, long-term care planning, nursing home contracts and admission, senior estate planning, special needs planning, estate planning, and estate taxation.

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