Some people turn to life savings to pay for Long-Term Care. It’s disheartening, though, to see savings accumulated from a lifetime of hard work dwindle to nothing. With Nursing Homes in Arkansas costing roughly $112,000 per year, it may not take long to completely deplete that nest egg.

A lucky few have Long-Term Care insurance or VA service-connected benefits. However, some people stay in Long-Term care for years, and insurance benefits may have a cap.

Others turn to Medicaid for help at this stressful time – only to face a mountain of paperwork and a frustrating process. Applications have to qualify for Medicaid, and that’s where things get sticky. To be eligible, applications must meet asset and income limits.

The Home is an excluded asset to qualify for Medicaid benefits, BUT, through the Medicaid Recovery Program, the State of Arkansas WILL put a lien on the home when a Medicaid application is submitted to DHS.

In states that do not have a Medically Needy Program, Medicaid applicants often use a trust to effectively lower their countable income below the state limit. 

The current income limit in Arkansas is $2,829. Income-only trusts, often called Miller trusts, are trusts that can be established by or for a person of any age, regardless of whether the person is a person with a disability.

The trust can be funded only with the person’s income, such as Social Security benefits, pensions, etc. It cannot be funded with assets such as money from a bank account or the sale of stocks or bonds.

And, like a special needs trust or pooled trust, a Miller trust must contain a clause that says that upon the death of the person for whom the trust is established, any funds remaining in the trust must be paid to the state Medicaid program, up to the amount the program paid for services on behalf of the person.

There are financial and healthcare powers of attorney. Financial Power of Attorney allows the individuals you pick to be able to manage your financial obligations when you are unable to do so. This can be anything from making payments on your behalf to planning that will protect your assets and make you eligible for certain kinds of benefits programs in Arkansas. Healthcare Power of Attorney allows the individuals you pick to be able to make health decisions for your care.

If something happens to you that leaves you unable to make decisions for yourself these Power of Attorney documents give your loved ones the ability to make the decisions for your care without having to go through the long, expensive court process to get a Guardianship, which is limited not only in the things that can be done but also the speed at which they can be done.  These documents leave you in complete control unless you decide otherwise, or become incapacitated.

A beneficiary deed, also known as a transfer on death (TOD) deed, is a legal document that transfers ownership of real estate to a named beneficiary  when the owner dies. A beneficiary deed is similar to a regular deed, but it doesn’t take effect until the owner’s death. The deed must be recorded before the owner’s death.