Elder law planning involves helping seniors obtain benefits to pay for the cost of long term care. Two of the main programs considered when paying the cost of long term care are VA Pension and nursing home Medicaid. VA Pension provides monthly cash payments to veterans and their surviving spouses to pay for long term care costs. Nursing home Medicaid pays part or all of the monthly nursing home bill for someone who has a medical need for nursing home care. More information on both of these programs can be found in the practice areas section of this website.
Along with having a medical need for long term care, applicants for nursing home Medicaid and VA Pension must satisfy income and asset test to receive benefits. The asset test can be satisfied by transferring assets out of the applicant’s name. many times the transfer of assets out of the applicant’s name involves the use of an irrevocable trust. A trust is simply an agreement by one person to manage the assets of another. The terms of the trust determine what distributions can be made and when. An irrevocable trust by its provisions cannot be changed. Many of the trusts used in Medicaid and VA Pension planning are irrevocable and contain tight restrictions against distributing assets back to the person who contributed such assets. These restrictions cause understandable anxiety for many seniors who worry that they are giving away control of their assets.
The anxiety around giving away control of all or a large percentage of one’s assets is understandable. You worked hard to provide for financial security and do not want to lose control over the assets. Although the senior does not have legal control over the assets of the trust, there still is some access to the funds in the trust. When a trust is created for the purpose of qualifying for long term care, a trustee who has the best interest of the senior. Sometimes more than one trustee is appointed to ensure that the interests of the senior are met. The trustee can distribute money to themselves and then use that money to purchase products and services for the benefit of the senior.
Working with an experienced elder law attorney will provide a plan that secures long term benefits and provides access to funds if needed.