When older adults start thinking about retirement, they need to plan for their protection in the future. Living on a fixed income isn’t easy. Even those who have saved assertively for their golden years may eventually have costs that they struggle to cover using their retirement savings.
If older adults develop mobility challenges or experience cognitive decline as they age, they may require regular support. Some people can receive the support they require from their immediate family members, but others need the support of professional caregivers. They might hire a home health aide to come to their residence. Other times, they may need to move into a nursing home.
If older adults haven’t planned in advance to cover such expenses, they may end up in a more difficult situation.
Medicare doesn’t cover everything
Contrary to what many aging adults expect, Medicare coverage simply isn’t enough to cover all of their long-term care expenses. Medicare covers basic, routine costs but not the extraordinary expenses often associated with nursing home residency or in-home medical support.
Older adults may need to look at their options for covering long-term care costs, which may include long-term care insurance or Medicaid benefits. Long-term care insurance may not be practical, especially if the individual is already at or near retirement age.
If people intend to apply for Medicaid when they require long-term care, prior planning is of the utmost importance. Medicaid looks back at five years of financial activity before determining if any kind of penalty applies given an applicant’s circumstances. Penalties can delay access to care when people are at their most vulnerable by making them directly responsible for their care costs.
There’s also the risk of estate recovery efforts that could diminish the legacy of the older adult after their passing. Long-term care planning, especially as it applies to Medicaid, could involve transferring property to a trust and taking on co-owners. People may also give gifts to their family members years before they anticipate needing Medicaid.
Addressing elder law concerns, such as long-term care costs, can help people navigate their golden years with grace. The sooner people plan, the easier it may be to cover expenses if intensive care is needed later in life.