Medicaid, Long Term Care and Second Marriages
When illness strikes you do not usually think of legal relationships but when a spouse needs serious care and is married to a second wife or husband, family relationships can bring with them unexpected problems and conflicts both for the second spouse and for children by a prior marriage. This is what sometimes happens. Since, in my experience, it seems to happen more often with a second wife and her husband who needs care rather than the reverse, I will use the example of the wife.
The spouse cares for her husband as long as she can at home. How long this goes on varies widely and could continue indefinitely. The stereotype that, at the first sign of trouble, the spouse sends her husband to a nursing home is not usually what I see. Often the problem will be dementia. Husband wanders or becomes aggressive. Sometimes he requires complicated medical care and the wife becomes overwhelmed. She does not know how to handle her spouse safely at home.
If Dad moves to assisted living or to a nursing home, sometimes children cannot believe that their parent cannot be maintained safely at home.
In a situation reported recently in the news, a daughter of country western singer, Glen Campbell, challenged his move to a long term care facility by his wife of 32 years, Kim Campbell. Three years ago Campbell revealed he was suffering from Alzheimer’s disease. Although he released two final albums and went on a farewell tour, he stumbled through the tour. His condition has since worsened. His daughter lives in Texas and visits her father in Nashville frequently. There is no complaint regarding care but his daughter wants Dad’s Nashville family to visit more often and feels he should be home. Campbell’s wife states she wishes he could be home and visits every day. Who is right? There is no easy answer and the answers are complicated by finances.
While Glen Campbell is unlikely ever to need Medicaid, this is not true of many families. At a monthly rate for nursing care in this area of about $10,000 per month, without Medicaid planning and without using the Medical Assistance rules for spouses which are referred to as the so-called, “spousal impoverishment” rules, the spouse at home could take a very serious financial hit in a relatively short time. Without obtaining specialized legal help, she might never recover.
The Medicaid rules require certain assets to be moved out of the name of the spouse who needs care or he will not receive benefits. As to the house, although it does not have to be transferred to the spouse at home, if it is not and she should die, the jointly-owned house would be inherited by the spouse in the nursing home and the government would claim against his estate for the amount they paid.
The rules for the spouse at home are not that easy either. If she had a prenuptial agreement, that is disregarded in Medicaid. All of her liquid assets except her income and retirement funds such as IRA’s, 401(k)’s, are included in the Medicaid calculation for the spenddown. Without additional planning, she can keep the house, a car, some other exempt assets and a certain amount in assets known as the “spousal share.” Her husband’s income will usually go to the nursing home.
Recognizing all of this, if a spouse instead plans in advance it is possible using other strategies to hold on to assets that otherwise would need to be spent. To do this she really needs to consult with an attorney who is very familiar with the Medicaid rules.
It is understandable that children by a prior marriage could misunderstand and misinterpret what is happening with Medicaid planning. What they see is their father’s second wife transferring assets and they do not know why. If good communication has been maintained over the years, children by prior marriages might be included in the planning process so that they know what is happening and why.
For some, remarriage is the perfect answer. Others could decide not to remarry depending on circumstances. Understanding the risks and the benefits, both emotional and financial, is important.
About the Author Janet Colliton
Esquire, Colliton Law Associates, P.C. Janet Colliton has practiced law for over 38 years, 37 of them in Chester County, Pennsylvania, a suburb of Philadelphia. Her practice, Colliton Law Associates, PC, is limited to elder law, Medicaid, including advice, applications and appeals, and other benefits planning including Veterans benefits, life care and special needs planning, guardianships, retirement, and estate planning and administration.