One of the greatest fears of older Americans is that they may end up in a nursing home. Going into a nursing home means a great loss of personal freedom, but also has tremendous financial cost. Nursing homes cost between $35,000 and $150,000 a year, depending on location and level of care.

Most people end up paying for nursing home care out of their savings, at least until the savings run out. Then, Medicaid will pick up the cost. Some of the advantages of paying for care yourself is that you are more likely to get into a higher quality facility and it eliminates or postpones dealing with your state's welfare bureaucracy an often demeaning and time consuming process. The major disadvantage is the expense.

Careful planning, in advance or in response to an unanticipated need for nursing home care, can help preserve your estate for your spouse or for your children. You can protect your estate by purchasing long term care insurance or by making sure you receive the benefits to which you are entitled under the Medicare and Medicaid programs. Veterans may also seek benefits from the Veterans Administration.
For more information see the key terms below and the Frequently Asked Questions Here

Elder Law Key Terms

Power of Attorney for Health Care
This document allows you to name another person as your agent to make your health care decisions if you are unable to do so.  A Power of Attorney for Health Care is only good for 7 years from the date of execution and then it expires.

Living Will
A “Living Will” used to be called, in Oregon, a Directive to Physicians.  A Living Will contains instructions about the withholding or withdrawing of life sustaining treatment if the person executing the Living Will becomes terminally ill.  A Living Will is only good for 7 years from the date of execution and then it expires.

Advance Directive for Health Care
An Advance Directive for Health Care is a form of medical directive that combines both the power of attorney and living will and, unlike the Power of Attorney for Health Care and Living Will, it does not expire after 7 years but can last for your entire life.  In 1993, Oregon replaced the Power of Attorney for Health Care and Living Will with the Advance Directive for Health Care.  The Advance Directive for Health Care can be customized to meet your individual needs and  allows you to make specific instructions about your health care wishes and also give specific instructions to your physician about life support measures.

Health Care Representative
A person named in your Advance Directive for Health Care who can make medical decisions for you if you are unable to make those decisions for yourself.

Durable Power of Attorney
A Durable Power of Attorney is a document that allows you to appoint another person to serve as your agent and take care of  necessary financial, banking, tax, legal, and other matters if you are unable to do so. This power of attorney is called “durable” because  it remains effective even though you may become incapacitated and can last your entire lifetime.

Agent or Attorney-in-Fact
An Agent or Attorney-in-Fact is the person named in your Power of Attorney to manage your finances and make financial decisions for your if you are no longer able to manage your own finances.

Guardianship
A Guardianship is a court proceeding to appoint a person to manage the personal affairs of an incapacitated person, including that person’s medical care and long term care placement.

Conservatorship
A Conservatorship is a court proceeding to appoint a person or institution to manage the financial affairs of an incapacitated person.

Incapacitated
A person is incapacitated when that person’s ability to manage his or her affairs is impaired to the point that they can no longer meet the essential requirements for health and safety, that is: taking actions necessary to provide the health care, food, shelter, clothing, personal hygiene, and other necessary care, without which serious physical injury or illness is likely to occur.

Protected Person
A person whom the court has found incapacitated and for whom a guardian or conservator has been appointed by the court.

Medicare
Medicare is our country’s health insurance program for people age 65 or older. Certain people younger than age 65 can qualify for Medicare, too, including those who have disabilities and those who have permanent kidney failure or amyotrophic lateral sclerosis (Lou Gehrig’s disease). The program helps with the cost of health care, but it does not cover all medical expenses or the cost of most long-term care.

Medicare has four parts:
Hospital insurance (Part A) that helps pay for inpatient care in a hospital or skilled nursing facility (following a hospital stay), some home health care and hospice care.

Medical insurance (Part B) that helps pay for doctors’ services and many other medical services and supplies that are not covered by hospital insurance.

Medicare Advantage (Part C) formerly known as Medicare + Choice plans are available in many areas. People with Medicare Parts A and B can choose to receive all of their health care services through one of these provider organizations under Part C.

Prescription drug coverage (Part D) that helps pay for medications doctors prescribe for treatment.

Medicaid
Medicaid is a joint Federal-State program created to assist people to obtain better access to health care.  Each state operates its own Medicaid system, but this system must conform to federal guidelines in order for the state to receive federal money. The Federal government pays for about half the state's Medicaid costs. The eligibility rules are somewhat different from state to state since each state administers its own Medicaid program, and the rules keep changing.

Medicaid Eligibility
In Oregon, Medicaid only applies to certain groups who meet both an income test and resource test.  These groups are people that are: Age 65 or older; disabled according to Social Security definitions; Blind; Institutionalized in a hospital or nursing facility; or receiving SSI.  To be financially eligible, a person applying for Medicaid cannot have more than $1,809 per month in gross income (Yr 2006) and cannot have more than $2,000 in resources.

Deficit Reduction Act (DRA)
The Deficit Reduction Act of 2005 (the DRA) was passed by Congress and signed into law by President Bush on February 8, 2006. The DRA significantly changed Medicaid eligibility rules and the treatment of asset transfers for nursing home residents. These changes will become effective on a state‑by‑state basis over the next few years.  One significant change is an increase in the “lookback” period. For transfers made prior to enactment of the DRA on February 8, 2006, state Medicaid officials will look only at transfers made within the 36 months prior to the Medicaid application (or 60 months if the transfer was made to or from certain kinds of trusts). But for transfers made after passage of the DRA the “lookback” period for all transfers is 60 months. Asset transfers should be made carefully, with an understanding of all the consequences. People who make transfers must be careful not to apply for Medicaid before the five‑year lookback period elapses without first consulting with an elder law attorney.

Income Cap Trust
An Income Cap Trust is a special type of trust for those individuals trapped in the gap of having too much income to qualify for Medicaid and too little income to pay privately for the costs of long-term care. The only purpose of the Income Cap Trust is to solve this particular problem.

Special Needs Trusts
A Special Needs Trusts also known as a Supplemental Needs Trusts is usually created by a parent or other family member for a disabled “child” (even though the “child” may be an adult). The disabled individual can also create the trust with his or her own money provided the trust meets certain requirements. These latter trusts are sometimes called "(d)(4)(A)" trusts after the authorizing statute.  The funds in these trusts will not be considered to belong to the beneficiary in determining his or her own Medicaid eligibility if the trust is properly structured.

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