Because of increased longevity, we are seeing a larger need for long-term care services: home care, assisted living, nursing homes, and hospice. The cost of these services continues to increase. An annual bill for nursing home care can cost, on average, over $125,000 in California. While a lucky few are able to pay for that care out of their own pocket, the vast majority face financial devastation from the prospect of spending down assets.

The chances of needing to use a long-term care facility rise to 75% if a person is 65 or older.  Buying long-term care insurance can be an option to protect assets against that risk. But this option is limited because many people wait too late to buy it and it either is too expensive to purchase or they do not qualify for it.  Unlike health insurance, long-term care insurance underwrites the policies and can deny coverage if there is anything in the person’s health history that may make them a high risk of needing insurance.

Medi-Cal will pay for long-term care but only after a person spends down assets.  This is known as the Medi-Cal spenddown, which is based on a complex set of rules. When a couple is married, assets of both spouses are factored into the spenddown formula – regardless of whether or not the couple has a prenuptial agreement.  

For those who cannot afford the insurance or do not qualify for the insurance, there are advanced planning tools available to help you protect your assets. The Law Office of James Dolenga specializes in helping clients navigate the available planning options and protect the vast majority of assets from the Medi-Cal spenddown. To get a review of your situation, click here.

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