Long-term care payment can reach catastrophic levels

What you see and hear depends a good deal on where you are standing—C. S. Lewis, The Magician’s Nephew

         A few years ago, a well-known and respected nationally syndicated columnist took elder law attorneys to task in a Wall Street Journal column.  She took several strong positions against using current law to do planning for Medicaid in particular, and against elder law attorneys in general. 

           It was scathing, and it caused me to wonder, among other things, whether the same columnist ever advises readers to use current law to legally plan reduce their tax obligations as much as possible? It looks like maybe if you want to take a certain action, you can call it “using the law to plan.” If you think people shouldn’t take a certain action, you call it “using the loopholes” and you talk a lot about the moral high ground.

             This is one of the most fascinating things about political dialogue:  the way that individuals view the same issue so differently.  The bottom line on most issues, really, is that both positions likely have advantages and disadvantages. We as consumers and voters should gather all the information we can, and then make political decisions consistent with our own values and beliefs. 

But I digress.  As Charlie Sabatino, a past president of the National Academy of Elder Law Attorneys (NAELA), wrote to the Washington Post in response to article mentioned above, “the goal of [Medicaid planning] is to increase the quality of life for elders. Increasing the quality of life requires money. So preserving what assets one has is just as important in Medicaid planning as it is in any other aspect of estate planning.”

Sabatino went on to say that because there is no national policy to provide long-term care, attorneys and other advisers are sometimes forced into “strained planning options.” To demand that attorneys “cease providing advice on Medicaid to individuals is to ask attorneys to act in violation of professional ethical standards. Failing to disclose all legal options for planning to meet the catastrophic cost of long-term care would violate the duty to provide competent and complete advice.” Under the current system, Sabatino says, “Families are left to find their way through an uncoordinated hodgepodge of programs not covered by Medicare or most conventional insurance.”

A few years ago, after exhaustive research and careful planning, NAELA issued a White Paper calling for universal coverage of long-term care under a Medicare type of insurance model that would eliminate the need for any Medicaid planning. This would eliminate a certain segment of elder law attorneys’ work, yet NAELA supports it as a component of their national policy objectives.  Sabatino asked a rhetorical question:  how many other professional organizations would promote the elimination of a segment of their work for the greater good?

Over and over again, this column has raised the issue of how readers intend to pay for long-term care. The issue of how-to-pay is rapidly reaching the catastrophic level. Nursing home costs continue to rise, and statistics indicate that the number of elders who will use long-term care at some point during their life is growing like Topsy.

Appropriate consideration of how to pay for long-term care includes many more options than Medicaid planning. In fact, in our office, in speaking engagements and other opportunities, we continue to strongly suggest that individuals consider and purchase long-term care insurance. Other ways to pay for expensive long-term care are scarce:  There’s Medicaid, long-term care insurance, and private pay with your own assets. The VA Aid and Attendance pension program may, under certain circumstances, provide increased monthly income for the veteran or his/her widow/widower.  That’s pretty much the entire menu.

When I talk to audiences about wills, medical directives, and powers of attorney, I stress how these should not be “one size fits all” documents. Each document should be thoughtfully tailored to the needs and specific goals of its creator. The same is true for long-term care payment options.  Whether an option is appropriate and feasible for you as an individual depends on your total circumstances. It is ultimately your choice, no matter how many advisers you may have. Sometimes advisers need to pay less attention to the political arguments that will always be with us, and more attention to your goals—as defined by you.

Although Medicaid planning critics always seem to indicate their belief that elder law attorneys do little more than Medicaid planning, Mr. Sabatino responds that “there are myriad other issues related to aging on which elder law attorneys provide advice and guidance. These include retirement housing; home and community-based care options; individual rights under private and public benefit programs; quality of care issues; proxy decision making and guardianship; consumer problems; as well as traditional estate planning and financial planning.”

Unless we die young, as my own father did, we will die “old.” Before that time, we will no doubt experience many changes in life that are undesirable or unacceptable to us. Sometimes, despite our best intentions, we will “be a burden” to someone who loves us—someone we love and whom we don’t want to burden.  Sometimes, despite our planning, an unexpected illness will rob us of our ability to function, and the care required will take every cent we have. When those things happen, we may have no choices. Today, if we are in relatively good health and with “time” ahead of us, we have choices. Therefore, we must learn everything we can in order to make the best decisions humanly possible. Thank you for reading.  Stay well.  See you next week.