While writing this article, I got a call from son. Mom had given him her power of attorney. He wanted advice regarding what he could do with his mom’s funds as part of a Medicaid eligibility plan for her. His request was identical to so many other calls that I receive, the ones that ask me to advise them regarding asset protection. I don’t take many of those cases.

Two stark realities thrust the words “asset protection” into the practice of elder law. First, the cost of long-term care is staggering. A person requiring 24-hour care, and wanting to receive it in his home, may pay $25,000.00 per month or more. If that person requires placement in a memory care facility, the cost will be less, but it will most likely exceed $10,000.00 per month. Second, except for the few people who invest in long-term care insurance, Medicare and other health insurance policies do not pay long-term care costs. The combination of these two factors results in long-term care costs depleting savings at an alarming rate, and it causes the people who are facing these factors to ask the question: Is there any way to protect my assets from being completely exhausted on my/my spouse’s long-term care?

Long-term care insurance is one tool that can prevent or reduce the depletion of assets on long-term care costs. However, it is expensive and subject to unexpected and substantial increases in monthly premiums. Most of my clients can’t afford long-term care insurance.

Without long-term care insurance, my clients have two sources for paying for long-term care: their own assets and Medicaid. Medicaid is the joint State and Federal program that pays for long-term care for eligible Medicaid beneficiaries. Eligibility depends upon physical and financial factors.

Given these two sources, some of my clients wonder whether it is possible to protect their own assets and get Medicaid to pay for long-term care. Some elder law attorneys base much of their practice on the consideration of these possibilities, and on assisting clients with becoming eligible for Medicaid long-term care benefits. They will explain Medicaid rules, outline and assist in the implementation of eligibility strategies, and even take the lead on the completing Medicaid applications.

My practice related to Medicaid is more limited. I try to explain Medicaid rules to clients, emphasizing that if a client receives Medicaid, the State is not going to “take the house,” and that Medicaid rules are designed to provide care for one spouse while not impoverishing the other. We talk about how different asset transfers may affect Medicaid eligibility. If a client is interested in more elaborate planning strategies, I typically refer him to another lawyer. I find that such strategies are risky and difficult for a client to understand. They make sense in the context of Medicaid and its rules, but they would never merit consideration outside of that context. In my clients’ lives, Medicaid is part of the picture, but not the only part.

Like many elder law issues, asset protection cases are not always driven by the elderly. Son or daughter may have heard about the cost of long-term care and anticipated its impact on their inheritance and urged mom and dad to hire an elder law attorney to discuss asset protection. One of the dynamics at the heart of the most toxic elder law cases is when kids treat inheritance as an owned asset instead of as a fiction that might someday be true. If preserving inheritance is the goal in a case related to long-term care costs, I am not likely to take it. I am more interested in helping a single client or a couple come up with a plan that will sustain the highest quality of life possible for as long as possible. Like growing old itself, this can be a difficult task.