Medical professionals are one of the most vital members of a successful estate planning team.  Unfortunately, long term care planning is frequently overlooked in the estate planning process.  Doctors, nurses, physical therapists, and other medical professionals are necessary for your plan of current and future financial stability.  Nearly everyone can agree that planning for a health care crisis is certainly not pleasant business.  It is, however, vital in order to ensure that our health care and financial wishes, not someone else’s, will be legally honored.  Unfortunately, it is not enough to plan only for legal matters regarding your health.  You must also consider the level and the cost of health care you may need at a critical moment in your life.  

    Planning for the unthinkable health care crisis can be most disconcerting.  Without such preparation, however, financial disaster could be on the horizon for you and your loved ones.  Dr. Jonathon Cluett, an orthopedic surgeon in Massachusetts and a regular contributor to about.com guide to orthopedics, reports that hip fractures are the most common broken bone in older Americans.  Over 300,000 people are hospitalized for the condition every year due to falls and accidents.  With careful planning, you can rely on Medicare coverage if such an event should happen to you.  Medicare will provide up to one hundred days of care in a nursing home as long as the patient is showing continued improvement.  Those one hundred days could cost as much as $25,000.  With advanced planning, this is a substantial amount of resources that can be retained for your potential benefit.

     Discussion of Medicare often leads to questions about Medicaid.  All services through Medicaid are based on the applicant’s medical necessity.  At the time you create your estate planning team, however, you may not be in need of any medical services for daily living.  Medical necessity creates the biggest obstacle in advanced planning for Medicaid.  According to Medicaid guidelines, a licensed health care practitioner must certify that the patient needs hands-on or stand-by assistance with two or more daily activities.  Those activities include bathing, dressing, eating, toileting, transferring from location to location, and continence issues.  If planned for in advance, money can be saved by seeking Medicaid for required, substantial supervision due to Alzheimer’s disease, senile dementia, or any other severe cognitive impairment.

     Consider the case of Jackson and Peggy Moore.  Both Jackson and Peggy worked their entire adult lives and saved diligently for The Golden Years.  They had more than adequate amounts of money in savings as well as multiple CDs.  Medicare covered nearly all of their medical expenses.  Just after Jackson turned sixty-eight years old, however, an unexpected tragedy occurred that neither of the Moore’s had planned for.  Jackson had a severe stroke that left over seventy percent of his body paralyzed.  The stroke required Jackson to be admitted to a nursing home for long term treatment.  Over time, medical costs began to grow, but the Moore’s only child lived on the other side of the country and had money issues of her own.  Eventually, Peggy lost the home that she and Jackson had lived in for over forty years in order to pay for her husband’s nursing needs. 

    Jackson and Peggy Moore’s story, though fictional, is not unique.  Americans are inundated with stories like these every day.  However, there are steps that you can take to prevent such a tragedy like the Moore’s in your own family with advanced planning.  By using the medical evaluation of a physician, the entire value of your home may be saved.  Children can become the legal recipient of your home without penalty if they are responsible for keeping a parent in a nursing facility for at least two years, depending on residential status.  If you should require such long term care if the future, this planned arrangement would still provide for the housing needs and quality of life for your loved ones.              

    The input of valued medical professionals can be invaluable on the estate planning team.  Without the advice of doctors, nurses, and other medical professionals, thousands of dollars could be lost to the medical costs, and, worse yet, your home.  Quality estate planning now for whatever bumps and turns the future may bring you could be the difference between financial freedom and financial devastation for you and your loved ones.