My oldest daughter just became licensed as a CNA (Certified Nursing Assistant) this summer, as she needed to find a way to get work experience in the medical field, and she wants to become a doctor.  She found her first job working as a CNA doing overnight shifts at a memory care facility.  She mostly keeps track of the people and guides them back to their rooms, as the overnight shift is for sleeping, but she also does need to take care of the residents as needed.  Some have trouble getting up, and my daughter dealing with the residents’ incontinence issues are also part of her job description, so she has plenty to do.  She is also tasked with prepping food for the next day’s meals, so she has plenty to do.  She cares for the residents for the time she is there, and passes off the residents to a different caretaker when her shift ends.

I know I would be perfectly fine with having my daughter work as a caregiver for me if I were older, but by the time I may need long term care, I am fairly certain my daughter will have moved on to being a doctor and would not want to just fill the role of being a CNA level caretaker.  I am not sure how most everyone else feels about having their parents or other relatives cared for by another person, but I am fairly certain this is not a topic anyone is just SO EXCITED to discuss.  However, because it is necessary to consider as we age, there are a few things to consider and prepare for now, so that getting an aging parent into a care facility is not nearly as terrible as it might otherwise be.

 

Prepare the Required Legal Documents Now, So You Have Them

Almost every care facility that I have encountered wants the resident / patient to have a financial and a medical power of attorney in place, to be put on file with the care facility and possibly a living will / advanced directive.  The owners and operators of the care facilities require the documents to be on file because the care facility needs to know who they can contact if the resident is unable to make their own decisions.  Certainly not all residents of all types of care facilities lack the ability to make decisions on their own.  If someone is a resident of a senior living community or facility or even assisted living, the person likely has the ability to make decisions on their own.  But, if a person is a resident of a memory care facility, or possibly a skilled nursing facility, then the person likely does not have the ability to make their own decisions.  My daughter works at a memory care facility and none of the people there really even have an idea of where they are or who their family is.  They certainly cannot make good, rational decisions on their own medical care or financial decisions.

Instead, the care facilities know that they need to be in contact with the named agent under a medical or financial power of attorney, depending on the type of decision to be made.  This gives the care facility staff and ownership / operators the information needed to be talking to the resident’s authorized representative.  The care facility staff and ownership / operators need to interact with the authorized representative, the correct agent under a medical or financial power of attorney, or else the care facility staff and ownership / operators may face serious negative legal and business ramifications from taking unauthorized actions.  The care facility staff and ownership / operators need to do things the right way to care for their residents (your loved ones), so having financial and medical powers of attorney in place is almost always required for entry into a care facility.

 

You Need to Start Thinking About Costs Now, Not Later

Care facilities are fairly expensive.  Adult day care facilities cost about $30,000 on average per year in Colorado, while assisted living costs $57,000 per year on average, or about $64,000 with someone acting as an aid to the resident, while skilled nursing facilities cost around $120,000 a year, on average.  Costs for memory care can be even higher, as memory care often requires round the clock monitoring and care (like the kind my daughter gives), locked and protected facilities, and highly trained staff to care for those with memory loss.  Not everyone has a ton of money to use for long term care costs like these, so people looking at long term care find themselves looking at how to pay for the cost of care.

One option is to purchase long term care insurance.  Traditional long term care insurance is something you purchase when you are young and healthy, and pay into the long term care insurance policy over time, so that when you need long term care insurance, you are able to use the insurance policy to pay for your long term care at a care facility instead of paying out of pocket.  As someone gets older, the long term care insurance premiums become more expensive, and can become prohibitively expensive if someone is old enough.  There are also long term care policies that are a sort of hybrid between long term care and life insurance policies of annuity policies.  My financial planner friends who specialize in aging, or elderly clients tell me these are great options, but even the best option for long term care requires planning ahead.

 

2 (a) – What About Government Programs, Like Medicaid?

Medicaid is the largest long term care payment program available from the government.  While many think of Medicaid as being health insurance for the poor, the program does pay for long term care for many people who have run out of money – or those who have planned properly.  Medicaid does have strict rules concerning eligibility.  Someone who needs Medicaid is only allowed to have $2,000 of what is called “countable” assets.  A countable asset is something like money available to use to pay for care.  Countable assets do not include your primary residence (up to $750,000 in value / equity) and one car, although once you have passed away, Medicaid can collect monies spent on your care from your estate, including your house once you and your spouse do not live in the house.  If one spouse needs Medicaid, the other spouse is allowed to stay in the house as long as they are alive and also has the ability to keep $157,920 in usable assets, as of 2025.  While $157,920 is certainly much higher than $2,000, it is still not the type of money that would allow someone to live forever on just that amount.

For those who want to plan ahead, they need to think about the Medicaid rules and look-back period, which is 5 years.  This means that if someone is trying to move assets around and and remove assets from their ownership to qualify for Medicaid, they need to do so more than 5 years before they apply for Medicaid.  Anything given away, or sold for less than fair market value within the 5 years prior to applying for Medicaid will be counted against the person, and the person may be deemed ineligible for Medicaid if assets were transferred in less than 5 years prior to applying for Medicaid.  There are some exceptions to the 5 year rule, such as when a family member stays in a house and cares for a parent, so the house can be given to the caregiving child without triggering the 5 year period, but the exceptions are quite limited.

I do know there are other attorneys who handle planning for Medicaid when less than 5 years are available for moving assets, but that is not part of my practice.  I can refer people to my friends who handle that type of Medicaid planning – when less than 5 years is the time frame involved – which I would term “crisis” Medicaid planning.  I do know that there are still limited options at that point, so planning ahead is just better.  I do Medicaid planning when we have 5 years, or longer to work with, and there are ways to reposition assets to qualify for Medicaid, we just need to start sooner than later!

 

You Still Want to Plan Ahead With Your Estate Plan

When you enter a long term care facility is not the best time to first be thinking about estate planning.  If you don’t have anything like a will, trust, or other estate planning set up and you are entering a long term care facility, you will want to get your estate planning done as soon as you can, using the “better late than never” theory of estate planning.  However, it is much better to get your will and trust, and other estate planning documents in place now, so that you don’t need to have setting those documents up be a worry as you enter a long term care facility.  You are far better served to have your estate plan in place, and possibly a long term care payment plan in place, long before they are needed.  An experienced estate planning attorney can help with getting the estate plan in place.  To make an appointment to get started, click the button below.