Assisted Living Facilities – Transitioning to Medicaid (Part 2)
In my blog post last week, I started to tell you about the recent calls to our office from families who thought they had established a clear path to Medicaid for their loved one who moved to an assisted living facility. Only when they were close to spending down their entire savings did they come to realize that things may not be as easy as first thought. This week I detail some of the reasons why that can happen. First is the medical reason. Assisted living (AL) facilities now have many more residents who need nursing home level care than when I first began working in the elder law field 30+ years ago. Back then if residents needed a higher level of care, they were told that a move to a nursing home was required. Now, with many AL facilities having dementia units, they can keep many of those same types of residents. In fact, sometimes people think that a move from the non dementia to the dementia unit is actually a move to a nursing home. In reality, both units are licensed as AL. If the facility, however, determines that your loved one needs more care than they can provide, a move to a nursing home may still
Assisted Living Facilities – Transitioning to Medicaid (Part 1)
The topic of this week’s blog post is the transition from private pay to Medicaid in an assisted living facility (ALF). We have had a number of calls recently to our office from families whose loved ones moved to an ALF two or so years ago with the expectation that they would spend down their loved one’s remaining assets towards the cost of care and then Medicaid would take over payment. As funds are winding down and discussions had with the facility about next steps, some families are realizing that the transition from private pay to Medicaid isn’t as easy or simple as they first thought. While it is impossible to know what was or wasn’t discussed in those initial sit downs with facility representatives at the time of admission, these calls lead to the conclusion that there is clearly a disconnect. When the realization sets in that the transition may not be so easy sometimes panic sets in as the assets dwindle. In some cases there are a limited number of Medicaid slots available. In other cases the private pay requirement hasn’t yet been met - a requirement that several callers say they was never discussed. In yet other instances the resident’s physical or mental
Estate Administration Tales – Part 5
In my blog post last week, I told you about the last piece of information that Daughter provided me. There was an account in Dad’s name that she said was not really his. That’s because he was “holding” the money for his friend. As I explained last week, because there was no written agreement, all heirs would have to agree to waive any interest in the account since it was titled only in Dad’s name. Daughter had not yet had a conversation with her half sister to know whether she would agree. Had Dad executed a will specifically leaving the bank account to his friend, there would be no question as to Dad’s intent. It does, however, raise another issue. Since the account was in dad’s name, as far as the State of New Jersey is concerned the account is his. By leaving it to his friend, it triggers inheritance tax. Inheritance tax is different than estate tax. New Jersey eliminated its estate tax in 2019 but it still has an inheritance tax. Heirs are placed in different classes based on their relationship to the person who died and are taxed at different rates. Children and spouses are Class A beneficiaries, exempt from inheritance tax. Dad’s friend, however, is a non family member. He
Estate Administration Tales – Part 4
In my blog post this week I continue to tell you about a call we received concerning a dad who died without a will leaving a surviving spouse and 3 daughters from two marriages. I explained in previous posts that not everything passes to the surviving spouse under New Jersey intestacy laws, which control when there is no will. Daughter who called us said she and her sister wanted to leave their share to their mom and wanted their mom to receive 100% ownership of the home that was owned by Dad and which Mom continued to live in. She wasn’t so sure, however, about her half sister who may want to receive her share. Read my post from last week for an explanation of how each share is calculated and how we could accomplish that goal. It seemed like there was a way in which to make everyone happy. That’s when Daughter provided me with one more piece of information. She told me that the $50,000 individual account in Dad’s name was not really his. I asked her what she meant since the account was titled in his name. Daughter explained that the money in Dad’s account was really his friend’s money. I explored this further and learned that
Estate Administration Tales – Part 3
In my blog post last week, I was telling you about a call we received from Daughter concerning estate administration for her dad who died without a will. Her mom was the surviving spouse but her dad had 3 children, one from a previous marriage. I explained last week that because Dad did not leave a will, under New Jersey intestacy laws only a part of his estate passes to his wife. The first 25% but not less than $50,000 or more than $200,000, plus 1/2 of the rest goes to the wife. When I explained this, Daughter told me that she and her sister wanted her mom to have 100% of the house. She told me it is worth approximately $750,000. I then asked what other assets Dad had. She told me that there was a joint bank account with Mom of about $50,000 and another bank account of $50,000 in Dad’s name alone. The joint bank account is a right of survivorship account so Mom was entitled to this account by law. The only assets that pass by way of the intestacy law then would be the home and the other bank account. Under the intestacy law calculation, Mom would receive $200,000 (1/4 of $800,000) + $300,000 (1/2
Estate Administration Tales – Part 2
In my blog post last week, I explained that we often get calls from family members of a loved one after they pass away in which the family explains what the decedent (person who died) wanted with respect to the distribution of their estate. Without a written document, however, the law sometimes provides for a very different outcome. Let me explain by giving you examples. Daughter called us because her dad died. He left a surviving spouse and 4 children but not a will. Additionally, his surviving spouse was from a second marriage. 2 of his children he had with his second wife but 2 others he had as a result of his first marriage. Dad left a house, titled solely in his name, but which the surviving spouse still makes her home. He also left several bank accounts. Some were co-owned jointly with his wife and others were held in his name alone with no payable on death designations. The family assumed that everything would pass to the surviving spouse because that’s what Dad had always said should happen. But, again, he did not put his wishes in a written last will and testament. I explained that New Jersey law says otherwise. Under the intestacy laws - which provide for what happens