Does Your Estate Plan Consider Long-Term Care Costs?


Creating an estate plan or a will is not the same as long-term care or Medicaid planning. Often, an estate plan does not include considerations for the family’s assets or wealth, if there are significant health issues, medical bills, and/or long-term care services that are required. Unfortunately, a family’s wealth and legacy can be quickly depleted by the costs of long-term care.

Many seniors believe that if they have an estate plan, they have effectively done long-term care planning. But an estate plan only addresses the estate after death. Long-term care planning ensures that the estate (and a person’s life savings) is not completely exhausted by long-term care costs while they are living. This is a sub-specialty of estate-planning law. This type of planning helps clients plan ahead, in case of incapacity or the need for long-term or nursing home costs.

This is such an important component, since seven out of 10 people will require some type of long-term care in their lives. With the costs of long-term care averaging $6,000 to $10,000 per month, you can see how these services can quickly exhaust an elderly person’s life savings. More importantly, most long-term care costs are not covered by Medicare. So, some of the objectives of long-term planning include:

  • Plan for incapacity and nursing home costs

  • Avoid spending entire life savings for nursing home care

  • Save the family home

  • Preserve assets to pass on to beneficiaries

  • Focus on care and costs while a person is alive, before death

Long-term care planning often includes Medicaid planning - and is provided by elder law [vs. estate planning] attorneys who are educated in long-term care and Medicaid resources and requirements. Proper long-term care planning ensures that your legacy and many of your assets can be passed on to your children, not the state of Maryland nor the nursing home. The chart shows the different considerations between an estate plan and a long-term care plan strategy.

As you can see, long-term care planning requires thoughtful strategy. Medicaid planning adds additional considerations. Be sure that your estate plan includes a long-term care strategy and that a qualified elder law attorney has reviewed its efficacy. You, your spouse and your family will benefit from the pre-planning you do to ensure your own health is cared for and your family’s needs are met.

Tara Frame is an elder law and estate planning attorney. Her family’s practice has served the legal needs of the community for over 65 years. She can be reached at 410-255-0373.


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