If your spouse requires nursing home care, you're probably wondering how you will pay for it. Nursing home fees are exorbitant, and most Colorado residents won't be able to afford them without government assistance through Medicaid.
The problem is, it seems that Medicaid benefits won't activate until nearly all of your financial resources have been depleted. This presents a problem if one spouse needs nursing care and the other spouse doesn't. Will the nursing home bills eat up all of the couple's resources? Will the stay-at-home spouse become impoverished before Medicaid benefits are paid? With proper planning, you can avoid these disasters.
The Medicare Catastrophic Coverage Act
The Medicare Catastrophic Coverage Act protects spouses when one requires nursing home care and the other doesn't. Under this act, the spouse who doesn't need nursing care is known as the "community spouse," and the spouse who needs nursing care is known as the "institutionalized spouse."
The Act establishes the "Spousal Impoverishment Protection Law," which lets the community spouse retain much of the couple's assets and income while permitting the institutionalized spouse to benefit from Medicaid. These legal protections permit the community spouse to continue living his or her life with dignity and financial security.
The assets that the community spouse can maintain will depend on the unique financial circumstances of the spouses. Depending on the size of the community spouse's income and wealth, he or she may also be able to retain some of the institutional spouse's assets. However, limitations will apply to the amount of assets the community spouse can protect.
Protect your assets from depletion from nursing home bills
If nursing home care is required for one or both spouses in a marriage, it's important to review all of the facts and circumstances that apply to your unique situation. In some cases, you might benefit from utilizing the Medicare Catastrophic Coverage Act. In other cases, a wealth protection strategy can help you obtain Medicaid benefits despite a high level of income and assets.
Review your options with someone who has an in-depth understanding of Colorado estate planning and Medicaid law so that you can continue to live the lifestyle you desire while meeting your health care needs.