Planning for our twilight years is not easy, for seniors or the people who love them. Few people have the necessary knowledge, and the inherent hesitation in confronting the technical rules, regulations and laws can be daunting. Then there is the financial part of it; roughly 70% of people aged 65 or over will need some type of long-term care during their lifetimes. How can you make sure that you don’t outlive your money? 

These issues are the essence of elder law, a boutique area of law that requires specialized knowledge and a compassionate touch to support the needs of the elderly.

In practice, “elder law” can look like different things to different people, depending on your health and your stage of life. 

For someone who is relatively young and healthy, “elder law” looks a lot like traditional estate planning. Generally, the plan would center around a revocable living trust which will help your estate save on the costs and hassle of the probate process, while minimizing taxes depending on the nature of your estate. You would be able to change the terms of the living trust during the course of your lifetime, for example by adding or removing beneficiaries or adding or removing assets that belong in the trust. 

Other documents would also be signed, and for an older individual, these may hold more significance than they would for someone in their 30s or 40s. For example, an Advance Healthcare Directive coupled with a “Living Will” will outline your intentions should you become incapacitated, including the nature of your care and the person you designate as responsible for making decisions. A HIPAA authorization will grant an individual of your choosing the ability to access your medical records.

Similarly, a “durable” power of attorney will grant a person of your choosing authority to make financial or other transactional decisions on your behalf should you become incapacitated. This and other documents will prove vital should you be diagnosed with a debilitating illness such as Parkinson’s, dementia, or Alzheimer’s. This would also be a good time to look into long-term care insurance.

If you don’t do this "traditional” estate planning, and you become incapacitated, it would be difficult if not impossible to do it later, since you may lack capacity to execute the documents. Your loved ones would then likely need to seek a conservatorship to take over your affairs, a lengthy and expensive court process.

Don’t Rely on Medicare 

People are often surprised to know that Medicare, the government insurance program for the elderly, generally only takes care of you to a limited extent. The reality is most long-term care is paid out-of-pocket with your hard-earned money.

Almost everything Medicare does cover comes with enough fine print and strings attached to bore a lawyer. For example, if you fall and break your hip, Medicare will only cover a few days of the hospital stay, and anything after that will come with restrictions around your recovery and may even require you to chip in with copays and deductibles. 

Once you’re healthy, Medicare generally will not pay for any type of skilled care, from in-home care to a skilled nursing facility. Then what do you do?

Medicaid (Medi-Cal in California)

Well, first, with the help of your loved ones or an estate planning attorney (or a loved estate planning attorney), you would calculate how many months or years of care you can afford based on your assets. 

Then, to get any sort of help from Medicaid, or as it’s known in California, Medi-Cal, you would need to qualify both financially and medically. 

As of January 1, 2024, there is no “asset test” to qualify for Medi-Cal, but there is an “income test” that determines to what extent Medi-Cal can cover your expenses. The full extent of the rules and criteria are beyond the scope of this overview.

The Catch With Medi-Cal

Again, the government’s generosity comes with strings attached. In this case, under California law, Medi-Cal is authorized to recover the amounts it pays to senior citizens, or for skilled nursing at any age, from the recipient’s estate. This includes your home, if it goes through probate. 

However, if you have a living trust and you have transferred your assets including your home to your trust, there is no reimbursement. If you don’t have a living trust, an attorney specializing in elder law may still be able to assist you, but this is a complex undertaking and requires careful consideration. 

Other Considerations

Every individual situation is as unique as our clients. There is no one-size-fits-all prescription in elder law. Estates come in all sizes and medical care needs vary considerably. Some people have access to other government programs such as SSI/SSDI that affects eligibility for Medi-Cal, others have long-term care insurance that they depend on. Others are more concerned with charitable giving and taxes and preserving as much of the estate for the beneficiaries as possible. 

Contact Us

Whatever your situation, we are here for you. If you or a loved one needs assistance with Elder Law matters, we can help. Contact us at (805) 900-7850 or email info@mansoorlawfirm.com. You can also fill out the contact form below, and we will get back to you within 24 hours.