Inflation and What it Means to Seniors

Unless you have been living under a rock the past year or so, you have probably felt the impact of inflation on your pocketbook.  Going to the grocery store or filling your car up with a tank of gas just isn’t what it used to be.  

Now, imagine you are a senior citizen living on a fixed income and have long-term care costs to deal with.  According to a recent article in the Wall Street Journal, long-term care facilities are raising prices and tacking on new fees to the already high cost of long-term care, which often exceeds $200,000 a year in the New York Metropolitan area. 

Some facilities, in addition to raising their rates by 10% or more this year, are tacking on a new inflation-related daily fee of $25 or more.  While $25 a day may not sound like much, it translates to $750 monthly; a lot of money for someone living on a monthly fixed income.  

For those families who cannot afford these additional costs, the choices are slim.  One option is to move your loved one to another facility.  This is not ideal from several perspectives, including the fact that many seniors are frail and not able to move, and even if they could, are comfortable where they are and have a support group of friends and colleagues that help them avoid feeling isolated.   Alternatively, parents can move in with their adult children.  This can involve costs to make the home accessible to mom or dad, in addition to other logistical issues.  

If paying more money, moving to a less-expensive facility, or moving in with adult children, are not viable options, perhaps looking into government benefit programs that might be available to help pay for the cost of long-term care should be considered.  If you are a veteran, the U.S. Department of Veterans Affairs may offer some programs that can provide financial assistance if you qualify.  Some of these programs provide a monthly amount for seniors who can stay at home and others provide nursing home benefits.  In fact, there are some nursing homes that will accept veterans who qualify based on disability and other factors. 

If a VA facility is not an option, you can explore Medicaid planning. Medicaid is a jointly funded federal/state program that pays for long-term care for those who qualify.  There are strict income and asset requirements to qualify.  When Medicaid was originally enacted, it was intended to be a health insurance program for people who were destitute; it has turned out to be a safety net for the middle class. 

Qualifying for Medicaid involves understanding and complying with a labyrinth of complex and arcane rules and regulations.  For example, there are different rules for those who are single versus those who are married; different rules for those who need care at home and those who need care in a nursing home.  Moreover, the way these rules are interpreted by Medicaid may vary depending on where you live, where your application is submitted and who reviews the application.  

If Medicaid is going to be a consideration for you, it is best to plan.  By planning in advance, you can usually save a significant portion of your assets and not have to spend those hard-earned dollars on the cost of your long-term care.  It is never too late to consider Medicaid.  Even if you are already in a nursing home and paying privately for that care, Medicaid may still be an option for you if you know how to navigate the system.  Best to work with a Certified Elder Law Attorney who can help you through this process.

Bernard A. Krooks, Esq., is a founding partner of Littman Krooks LLP. He was named 2021 “Lawyer of the Year” by Best Lawyers in America® for excellence in Elder Law and has been honored as one of the “Best Lawyers” in America since 2008. He was elected to the Estate Planning Hall of Fame by the National Association of Estate Planners & Councils (NAEPC). Krooks is past Chair of the Elder Law Committee of the American College of Trust and Estate Counsel (ACTEC).  (914-684-2100) www.elderlawnewyork.com.