section 1 - The American College Online Learning Center

(2) Facilities, monthly fees, and services vary widely. However, in most casesfor a one-time entrance fee and monthly payments, your client can expectthe following (most of which help with frailty risk and long-term care risk):(a) A safe senior friendly environment with opportunities to increasethe client’s support network of friends. (For example, if your clientdoes not show up to the common dining hall for dinner, the usualdinner companions may check up to see if the client just decided todine privately in his or her apartment or if there is a problem.)(b) Some housekeeping and meal preparation services.(c) Transportation to area shopping and entertainment events.(d) Facilities for assisted living care and a nursing home come in thefacility of the CCRC.j. Clients needing extra cash for the risks associated with aging can also consider ahome equity loan.3. Create a separate portfolio that is reserved for the later years of retirement.a. The same logic that applies to the reverse mortgage (as a pool of money toprovide for long-term care risk, frailty risk, and health care expense risk) can beused for the separate asset class strategy. In other words, just like holding thehouse in reserve as a hedge against these risks, the use of a separate assetclass serves the same purpose.4. Implement a Medicaid spend-down.a. Medicaid spend-down planning is the process of assisting individuals intransferring, shielding, and/or converting assets and income into a form that doesnot disqualify them from receiving Medicaid benefits.b. Clients who have assets and income that fall below specified levels may be eligiblefor coverage under their state’s Medicaid system. Coverage under Medicaid wouldalmost fully account for both health care expense risk and long-term care riskbecause Medicaid provides comprehensive health and long-term care coverage.c. Planning Point: Clients may not be happy with medical and long-term careservices provided for the poor since there is little choice on the types of benefitsavailable and where to obtain the services. In addition, the quality of theseservices may pale in comparison to the quality of private pay services.d. Whether the Medicaid solution is available depends on the financial status ofyour clients.(1) This solution will probably not be available for affluent clients because theirasset base and income stream are too high to qualify for eligibility, andplanning to qualify for eligibility (spend-down) will be unwise and nearlyimpossible to accomplish.(2) This solution will probably qualify for low income and asset clients becausethey will either be eligible without planning or a spend-down plan can beset in place to make them eligible for Medicaid.(3) This solution is not initially available for middle income and assetclients because they will not qualify for Medicaid. However, some elderlaw attorneys and others have created strategies for clients to divestthemselves of their assets and meet the lookback and other requirementsof the state law. In many cases, clients can still keep family assets such asthe home, which may be exempt from divestiture under state law.5.18