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Public Benefits Planning

Public Benefits Planning is a touchstone of the term of art “Elder Law” and includes options for qualifying for long term care assistance (Arizona Long Term Care System, or ALTCS), Medicaid (AHCCCS in Arizona), Supplemental Security Income (SSI) through the Social Security Administration, and veterans’ benefits – as well as the complex issues related to these and other programs that evaluate income and assets to determine qualification.

Our firm can help protect assets for those who are already on public benefits and those who may become eligible in the future, so funds can be used in the most beneficial ways possible.

One of the main planning opportunities centers on ALTCS, which helps pay for long-term and acute care for the elderly and disabled. There are three criteria used to determine whether a person qualifies: medical, income, and resources.

To qualify medically, a person must be evaluated via a pre-admission screening (“PAS”). The evaluation will determine whether the person can perform activities of daily living on his or her own or needs assistance to perform tasks such as bathing, eating, walking, toileting, and dressing.

A person’s gross monthly income cannot exceed certain levels, depending on marital status, which are adjusted annually. If a person’s income is too high, it may be possible to set up a trust to become eligible.

There also are limits for resources. Some resources that are not counted (or exempt), including a house (with up to $500,000 in equity), a vehicle, some life insurance, burial plots, irrevocable funeral plans, household belongings, jewelry, and other items. For a married couple, the non-applicant spouse is entitled to keep additional resources. Resources also are subject to a five-year “look back” period; if certain transfers were made in the five years leading up to an application, the applicant may be penalized for a period of time.

If a family member is receiving or may in the future receive means-tested public benefits such as ALTCS or SSI, it is very important to make sure that the applicant, his or her spouse, and other family members coordinate their estate plans (wills, trusts, powers of attorney, etc.) to be sure those plans continue to make sense in light of the needs of the person receiving or going to receive benefits from ALTCS.

Among changes to consider is a special needs trust. Standard support trusts that provide for support, maintenance, health, or education are not special needs trusts and no not work properly for a beneficiary receiving benefits and may endanger those benefits. A properly drafted special needs trust will not jeopardize or interfere with the beneficiary’s public benefits.

We can help you analyze whether you may be eligible for benefits, advise you of possible strategies in the event you wish to plan ahead for an eventual application, assist with the application process itself, and ensure your overall estate plan makes sense in light of all of your circumstances.