To sell the house or not to sell the house? A Long-Term Care question
When families help aging parents make caregiving decisions (as we addressed in the last blog entry), finances always come into play. Whether the decision is to age in place and try to stay in the home with home-care services or receive services in a different living environment and reside in a senior apartment, assisted living or skilled nursing facility (a.k.a. nursing home), finances are always a consideration.
Often one of the first considerations is to sell the home to access the equity for long-term care expenses. A number of factors should be considered before jumping to that conclusion.
Long-Term Care and Medical Assistance
If the person/s have few assets and are close to being eligible for Medical Assistance to help cover long-term care expenses, selling the home and increasing the assets may not be a wise idea. Some states do not include assets, such as savings, retirement accounts, investments, etc., in the Medical Assistance calculation. However, if the state does count assets, often they do not include the house as an asset. If you sell the house and then have resultant savings, that money is counted.
Elderly Waiver and Alternative Care
A specific type of government benefit funded between the federal and state governments is the waiver program. Waiver programs for the elderly help provide services that can keep people in their home vs. entering a residential facility. With the burgeoning number of Boomers getting older and the limited resources of the government to continue to pay for total institutional care, the government is seeking ways to help provide care more economically and efficiently. Most people express an interest in remaining in their homes. Therefore, if the government can spend less to keep people in their homes and out of nursing homes, it is a win-win situation. Most states have different programs and criteria for eligibility. Again, this may be an option to review before deciding that the home must be sold to afford care.
Extra Help with Medicare Part D
To be eligible for Extra Help paying for your Medicare Part D prescription drug coverage, you must meet asset guidelines. Currently in 2012, a single Medicare beneficiary can have a maximum of $12,640 in assets. A married couple can have only $25,260. The primary residence is not included in the total assets. Again, selling a house might push someone out of eligibility for this program.
Medicare Savings Program
One of the best kept secrets about Medicare is the Medicare Savings Program. This program for lower income Medicare beneficiaries either pays only the Medicare Part B premium ($99.90 in 2012) or also covers the deductibles and co-pays for Medicare Parts A and B. The asset levels are low. In 2012 for Single–$10,000; for Married–$18,000. Again, the equity in a house is not counted unless the house is sold and savings results.
Help with Sale of Home Decision
These financial programs are just some of the issues to consider when deciding to sell a house to help aging parents or other senior adults. How do you decide? I recently heard a homecare agency professional say that a trip to an elder law attorney usually pays for itself– in savings from financial decision-making mistakes when planning for long-term care. Another source of information for state or local asset requirements is often county social workers who help administer these programs (Browse the web for “county social workers” or “county case managers”). Care managers who help evaluate housing and service needs and locate service providers can direct you to an appropriate professional for information in your state and situation. Area Agencies on Aging may also be able help locate these professionals for you.
There are obviously many factors to consider when deciding how to best meet the needs of your loved one. The decision to sell the family home can be an emotional one. Sometimes even though it seems like the simplest way to raise funds to provide services, selling the home may actually interfere with receiving those very services that could make your loved one most happy.
