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The Complete Guide to Planning for Long-Term Care Costs

- AlerStallings

When you envision what you might spend money on in your golden years, does the image include travel, spoiling your grandchildren, or perhaps indulging in a hobby? What about long-term care? If you’re like most retirees, that last one wasn’t what you had in mind.  

Nobody wants to plan for long-term care, but what’s worse than having to think about the possibility is not being prepared for it. That’s why we created this post with sample questions for your estate planning attorney and tips to make the discussion a little easier. Now you can spend less time worrying about the “what ifs” and more time enjoying the good stuff.


When it comes to planning for long-term care, you’ve got options. Here’s what we’ll discuss: 

Government benefits



Legal tools such as asset protection trusts 



Government Benefits

There are some government programs that may provide assistance with long-term costs if you qualify. We’ll break them down below. But before we do, we should address what you might have noticed is missing from the list: Medicare. That’s because Medicare will only pay for some home or nursing home care so long as it’s rehabilitative and not long-term.   


Medicaid & PASSPORT: Medicaid is the primary payer of long-term care in the country. This state-based program is available to those who have limited resources and fall below a set threshold for income and assets based on federal poverty guidelines, which means qualifying can be difficult. Plus, there are nuances that could make your eligibility less straightforward. For example, a healthy spouse may be able to keep some assets to live on without disqualifying the spouse in need of care from receiving benefits. And here in Ohio, it’s possible for people whose assets exceed the Medicaid threshold to qualify for a PASSPORT waiver—enabling in-home or assisted living care—by transferring assets into an asset protection trust, which is Medicaid exempt. We’ll expand on that under Legal Tools below.

VA: Veterans and their spouses may qualify for The Department of Veterans Affairs’ Aid and Attendance benefits, which can help pay for long-term care needs. This benefit provides monthly payments in addition to your pension for use toward assisted living costs. Note that you must be 65 or older, meet certain service requirements, and have income and assets below limits set by the VA, in addition to other eligibility factors. 


What to ask: 

How do I determine if I’d qualify for government benefits? 

If I do qualify, would the benefits cover the cost of care? 



Self-funding is just as it sounds: you’ll pay the tab and assume full risk for the cost. Because the cost of long-term care can vary widely, so too can the outcome. Since there is no risk-sharing, if the costs of care exceed what you’ve saved, you’re still on the hook. Alternatively, if you’re lucky enough to not need long-term care, the worst that happens is you’ve built a sizeable nest egg.  

In order to shoulder the cost of self-funding, you must have the financial resources to accommodate both an expensive extended long-term care stay and your retirement goals. Keep in mind that according to, the average cost of one year of care in a nursing home with a private room is $92,376 and the average stay lasts three years.  


What to ask: 

What is at risk if I decide to self-fund? 

How much should I have saved to meet my goals? 



Chances are you’ve heard of long-term care insurance. After all, it’s been around for decades. If you’ve also heard it’s expensive, then you’ve heard right. As people live longer, the cost and duration of care has risen, making it a losing proposition for insurance companies. For this reason, long-term care insurance isn’t as widely offered anymore and has risen tremendously in cost, making it unaffordable for most.  

Before you eliminate insurance as an option, be sure to check your life insurance policy, which may offer a valuable alternative to long-term care insurance if it allows for Accelerated Death Benefits. Policies with Accelerated Death Benefits provide a tax-free advance on your life insurance death benefit while you’re still alive to help with the cost of long-term care. The cap is usually around 50% of the death benefit, with monthly benefits around 2% of the policy’s face value for nursing home care, and half that for in-home care. 


What to ask: 

Would I be better off paying for long-term care insurance or investing the money? 

What are the limitations of Accelerated Death Benefits? 


When it comes to reducing your risk, estate planning and elder care law attorneys offer a wealth of resources. One such resource is an asset protection trust, which we mentioned above. In an asset protection trust, ownership of your assets and property are transferred to the trust, effectively shielding your estate from creditors. This can help some individuals qualify for Medicaid or preserve a portion of their estate or property for their loved ones.  


It’s important to note that this is a proactive measure that requires some forethought. That’s because Medicaid has a five-year “look back” period. Any property or assets that haven’t been in the trust for at least five years could disqualify you from benefits. That’s why it’s especially important to work with an experienced attorney who can help you understand your options and ensure that your trust is set up properly. 


What to ask: 

Would I be a good candidate for an asset protection trust? If so, when is the right time to put one in place? 

Are there any other estate planning tools that might be beneficial for my circumstances? 


Planning Your Next Steps

While there is no one-size-fits-all approach to planning for long-term care costs, we hope this post has helped demystify the options and illuminate what may be the best fit for you. As you consider your next steps, we urge you to enlist the assistance of a qualified estate planning attorney. At AlerStallings, we know that choosing an estate planning attorney is a highly personal decision, and that’s why we offer a no-cost, no-commitment consultation so you can get to know us. After all, we’re with you for life. This is a partnership that starts from the heart. 


We’re Here for You.

Call us at (614) 798-9800 to schedule your complimentary consultation.