How can you afford to care for your parents?

On Behalf of | Jul 17, 2020 | Estate Planning |

Looking after your parents as they get older can take a lot – a lot of time, effort and especially money. Getting them the care they deserve is no small task, but planning for the prices now may ease the load later.

Care can be nearly unaffordable without help. An individual room in a facility near Boston can cost close to $163,000 every year. While Medicaid could shave over $100,000 off that bill, not everyone qualifies. Fortunately, there are a few ways that those with too much now might get help before they’re left with nothing later.

Medicaid mandates

Getting your loved one to meet the requirements for Medicaid might take plenty of prep work. While no one answer solves every riddle, you might find the right solution for your family:

  • Spending down: Medicaid doesn’t allow applicants to get under asset limits through handouts, but you could find some costly necessities to put on the books. Purchasing uninsured medical equipment they need or paying off outstanding debts could be a place to start.
  • Annuities: Purchasing an irrevocable annuity could take care of the money that puts them over the amount Medicaid allows. The annuity will give it back in payments that keep them qualified. There’s plenty of fine print that comes into play, so it’s important to understand how much and how long the annuity can pay.
  • Spousal assets: One parent applying for Medicaid may be able to transfer their assets to a spouse who is not. Massachusetts allows the spouse of an applicant up to $128,640 in assets, so they aren’t made destitute trying to meet requirements.

Hitting the mark on Medicaid isn’t always an easy task, but understanding different strategies could help you devise a plan to make it work.