Older adults in Rhode Island often aspire to live independently as long as possible. Those who have plans to age in place might make their homes more accessible and tap into their local community for support as they age.
However, those who live particularly long and those who experience health challenges as they age may eventually need to move to a nursing home. Nursing homes provide assistance with medications, mobility issues and daily living needs. They are also incredibly expensive, typically costing thousands of dollars per month even for a shared room.
How can those preparing for their golden years arrange to pay for nursing homes?
Engaging in advance planning
No one wants to move to a nursing home, but those who recognize that it may be a necessity later in life can plan ahead. Those with significant retirement savings can sometimes set resources aside to pay for nursing home care in their golden years. However, many older adults do not have enough liquid capital to cover the astronomical monthly costs assessed by many nursing homes. They will therefore likely need the long-term care coverage provided by Rhode Island Medicaid. To qualify without penalties, someone will need to have exhausted all of their resources.
Any big transfers or gifts in the five years before they apply for Medicaid might lead to a penalty. The Medicaid penalty will force someone to pay for their own care even though they don’t have money and might leave them in a very difficult position. The best way to prevent the penalty is to plan at least five years before one might require nursing home care.
Strategic gifts, ownership changes and transfers into trusts are always to diminish someone’s personal holdings so that they can quickly qualify for Medicaid without a penalty in the future. As an added benefit, the preemptive transfer of those resources can also protect them from estate recovery efforts after someone dies.
A small percentage of older adults in Rhode Island carry long-term care insurance that covers their nursing home costs, but many find the premiums for such coverage to be prohibitive after they reach a certain age. As a result, having a broader plan in place to cover the costs related to nursing home care can give many adults in Rhode Island preparing for retirement more financial stability and peace of mind during their golden years.