Hello. My name is Christopher Lavin, I’m an attorney with the Lavin Law Group. We are an elder law firm here in Lebanon, Ohio. Elder law is both traditional estate planning as well as long-term care planning.
And the biggest part of long-term care planning is—everybody calls it ‘crisis planning’ because you’re dealing with an emergency situation. It’s not just a medical emergency, it’s also a financial emergency. Folks are trying to navigate the waters and figure out how they cover the cost of such care.
And often I’ll have the healthy spouse, maybe Mom, in the office with her three or four children, and unfortunately Dad is what we call the ‘institutionalized spouse’ or the person who’s not doing well and in a full skilled care facility. The first thing I want to relate to Mom in the office with the children is: the state cannot impoverish you because your loved one has the ‘wrong’ illness. They have to allow her something for quality of care.
And it’s intimidating because before she’s ever met someone like us, she’s heard so many different things. They’re going to take her house, they’re going to take her car, they’re going to take her income, she can’t have over $2,000 in total resources. And all that can be true to an effect if you don’t know the rules and you’re not on equal footing with the state.
So the biggest thing is we need to be on equal footing and know the rules every bit as well as they do. So she’s allowed to keep certain assets—again, it’s called the ‘spousal allowance.’ Part of that allowance is a house; of course she needs a place to live. Part of that allowance is one car of any value, a second car of lesser value; of course she needs a way to get around town. Part of that allowance is all of her personal property; they’re not worrying about her belongings unless she brags about them or puts a value on them. Part of that allowance is insurance, if it’s not too fancy or if it’s irrevocably assigned to burial. Part of that allowance is all of her income and probably a portion of his income; very few spouses can make it on an individual income alone, especially in fixed income and retirement.
And part of that allowance is some moneys in the bank. Now she’s going to hear $2,000, but it’s actually a sliding scale and this is where it gets confusing. Without crunching the numbers right here, the minimum the state will let her keep is about $30,000, the maximum they’re going to let her keep is $162,000. So she can never have over $162,000, but she can never have less than $30,000. Neither of those numbers are perfect and maybe everything they worked so hard for, but both of those numbers are better than 2,000 bucks.
The state will let you keep something. Yes, they’ll look for it later, so we have to continue the planning even after eligibility, and you can build on those numbers if your advisors know the rules and know the tools to do so. So please, don’t quit on us in a crisis. Seek help.