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COLUMN |
FOR IMMEDIATE RELEASE |
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State
Rep. Joseph Brennan |
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Planning Now for Future Long-Term Care Needs
By state Rep. Joe Brennan
No one likes to think about getting older, facing chronic illness or becoming too frail to safely live on our own. But it happens, and when it does, seniors and families often are unprepared, emotionally and financially.
Long-term care is a leading cause of catastrophic out-of-pocket costs for families. Fortunately, there are steps you can take to protect your assets and ensure a greater choice in long-term care options as you age.
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Long-Term Care Insurance: For many seniors, this is one of the
best ways to prepare for care. Long-term care insurance can provide coverage
for a full range of services, including home care, adult day care, personal
care home/assisted living and nursing homes. It can also help families
safeguard hard-earned assets. Be sure to consult a financial expert.
Here in Pennsylvania, we recently enacted a new law that encourages the
purchase of long-term care insurance by allowing residents to protect certain
assets. For example, the purchase of $100,000 in a qualified long-term care
insurance policy allows residents to keep $100,000 in assets and still receive
Medicaid if and when their insurance coverage runs out and they otherwise meet
Medicaid eligibility requirements. Information about this new law can be
located on the state Department of Insurance Web site at www.ins.state.pa.us/ins, Keyword "Long
Term Care," or by calling my constituent service office.
· Reverse Mortgage: Those over 62 who own their own home can tap into their home equity with a reverse mortgage. Funds from a reverse mortgage could pay for renovations to make the home safer for an elderly loved one, for home health care, to provide family caregivers with funds for out-of-pocket expenses, or to purchase long-term care insurance.
· Asset Transfers: Some seniors choose to transfer assets to family members so they can qualify for Medicaid. Be aware of new rules. The transfer of assets must take place a minimum of five years before care is needed or Medicaid will be denied. Think about the risks, too. If something unexpected happens, it’s possible to have no assets to pay for care and no Medicaid coverage. The rules on this are very complex, and you need to discuss this with your financial advisor and attorney.
· Retirement Plans: Those older than 50 may want to take advantage of 401k or IRA "catch up" contributions. You can shelter additional contributions and build a larger nest egg. Talk with a certified financial advisor who can help you understand how to manage and protect your assets.
These are just a few choices you have. Other options may be available, depending on your age and financial situation. Be sure to consult an expert. But above all, start talking now – husband to wife, children to parents. It may not be an easy conversation, but it’s necessary. For more information about planning for your long-term care, visit the Pennsylvania Health Care Association’s Web site at www.phca.org.