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The Scope of Long-Term Care

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One common concern that clients raise at initial estate planning meetings is “long-term care needs.” 

Depending on a client’s age, health and financial situation, “long-term care needs” can describe a variety of situations. “Long-term care,” although most often used to refer to nursing home care, is an umbrella term that can be used to refer to myriad circumstances in which someone cannot completely and independently care for him or herself. As a result, implementing a long-term care plan that thoroughly addresses an individual’s current and projected needs is a critical element in creating a comprehensive estate plan.

Basic Planning for Incapacity

Every client should have basic incapacity documents, namely:

  • A health care proxy, which designates a “health care agent” to make medical decisions on the client’s behalf during incapacity;
  • A durable power of attorney, which designates an “attorney-in-fact” to manage the client’s practical and financial needs (which can be made effective immediately or upon the client’s incapacity, depending on the client’s preference); and
  • A living will, which expresses preferences for end-of-life care and provides guidance to the health care agent (who would make such decisions for the client during incapacity).
Incapacity Planning with Trusts

When long-term care appears to be a remote possibility rather than an immediate concern – for example, in the case of a young couple in good health – it is important to consider what may happen in the event the plan is never updated or if something unexpected should occur in the future.  For example, conversations about who will be responsible for serving as Trustee in the event of incapacity or whether other family members (i.e., minor children) may benefit from a trust in the event of incapacity are important considerations when drafting a revocable trust.

Special Circumstances

If the client has a child with special circumstances who will require care after the client’s passing, then the client should consider creating a tailored care plan for the child. Counsel familiar with special needs planning can help clients develop this plan and put the right team in place.

Clients should consider:

  • Who should be designated as the child’s Guardian and where the child will live in the future.
  • What the potential future costs of care will be and how these costs will be paid.
  • How the child’s inheritance will be held (e.g., in a properly funded supplemental need trust (“SNT”)).
  • Whether the child with special circumstances requires more financial assistance than the other children.
  • Whether the child has the capacity to execute his or her own incapacity documents (i.e., Health Care Proxy or Durable Power of Attorney).
Traditional Long-Term Care

Many clients facing advanced age or a recent diagnosis may wish to prepare for their own or their spouse’s care in a nursing home, an assisted living environment, or care from home. As much as spouses or children may wish to personally care for their loved ones, there can be needs and issues that are beyond their means, both in terms of expertise and cost. 

As an entire generation of baby boomers reaches or nears retirement, this area of traditional long-term care is exploding in both cost and in need. According to a 2023 article by the New York Times, an estimated 10,000 people per day will reach age 65 between now and 2030, and by 2050, the number of Americans aged 65 years and older will increase by an estimated 50%.[1] Planning to live off retirement funds may no longer be feasible for this generation – particularly when costs of long-term residential care can easily exceed $100,000 per year absent Medicaid assistance.[2] 

In instances where long-term care appears to be inevitable and the individual faces depletion of assets through private payment of long-term care, planning to qualify for payments of long-term care facilities through Medicaid may prove the best option. Creation of an income-only irrevocable trust and a carefully calibrated “spend-down” strategy that will allow a person to qualify for Medicaid can allow clients to obtain the care they need, while also preserving some assets for the benefit of loved ones at death. 

There are a multitude of long-term care strategies that can be customized to meet a client’s particular needs. Learn more about our long-term planning services. For additional information on planning for incapacity, short-term care and long-term care for yourself and your loved ones, contact our estate planning team in the Private Client Services practice at Wilchins Cosentino & Novins LLP.

Mary G. Wilson is an attorney in the Private Clients Services practice area. Learn more about Mary.

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This Article is not legal advice and should not be taken as such or relied upon as legal advice.


[1] Reed Abelson and Jordan Rau, Facing Financial Ruin as Costs Soar for Elder Care, N. Y. TIMES (Nov. 14, 2023), Facing Financial Ruin as Costs Soar for Elder Care, https://www.nytimes.com/2023/11/14/health/long-term-care-facilities-costs.html.

[2] Id.

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