I sat in a stiff chair next to my 86-year-old dad as a lawyer outlined the complicated rules of Medicaid law.
My dad furrowed his brow, trying to understand the legal complexities that could mean the difference between being able to leave his home — where he’d lived for nearly 60 years — for my sisters and me, rather than having it confiscated as collateral should he die in a long-term care facility.
A few months earlier, my dad — who was recently diagnosed with early-stage dementia — called me with an urgent request. “I want you to make sure they don’t take my house,” he said, obviously coming to terms with the possibility that extended memory care could be in his future.
My dad has no savings to cover long-term care
My dad grew up one of nine kids raised during the lean years of the Great Depression and World War II. He knew the value of owning a home, both monetarily and in the sense of pride he derived from knowing he’d at least leave that small piece of property to my sisters and me after he died.
But like many seniors, he lives on a fixed income and doesn’t have savings to cover the often astronomical expense of long-term care facilities, even with Medicare. Should he need long-term care — a possibility despite his age since he’s in great physical shape and had a mother who lived well into her 90s — the ownership of his home could be in jeopardy.
According to federal and many state laws, Medicaid is required to pursue “estate recovery” after a recipient dies, often placing liens on the decedent’s home or estate to recover care expenses. There are several ways to avoid this, including setting up trusts and a form of property co-ownership called a life estate. Ultimately, our lawyer advised we take advantage of a caretaker clause in Medicaid law, which would apply to my sister, who lives with our dad.
As we went through all these scenarios, while also helping my dad set up his will, healthcare power of attorney (who makes healthcare decisions on his behalf if he’s incapacitated), and durable power of attorney (who can make financial decisions on his behalf), I couldn’t help thinking about my own family.
It made me realize I didn’t have a will
My husband and I did not have a will, any power of attorney, or even beneficiaries on our bank accounts. We’re both cruising toward 50, and we have a young son, so I knew we needed to address our own estate planning.
Our bank offers free estate planning consultations, so I booked an appointment for us to go through the basics before speaking with an attorney who will charge for their services.
Though we’ve been married almost 15 years and faced some health crises, such as my breast cancer diagnosis nearly a decade ago, my husband and I had never discussed what would happen if one or both of us died. While these conversations are hard, we knew they were necessary to ensure our son is cared for physically and financially after we’re gone.
In our case, if one spouse died, the other would automatically inherit any assets and assume sole guardianship of our son. But if both of us were to die at the same time, things get more complicated.
Since we have an underage child, we set up a trust where any of our assets — our home, retirement accounts, etc. — would go to benefit our child once he reaches adulthood. Then we had to choose who would not only take guardianship of our son but also manage our estate, taking care of everything from ensuring our final tax returns were filed to managing the money left to our son.
Talking about death can be hard
Through these conversations, we learned that not having specific, legally verified instructions for your assets — even if it’s just a checking account or a car — can cause bureaucratic headaches for grieving loved ones. And not establishing specific instructions via a healthcare power of attorney — such as whether you want to be resuscitated or put on life support — can put family in the difficult position of making life-or-death choices in the midst of a crisis.
I know that we’ve done all we can to ensure my dad is taken care of for the remainder of his life, and that everything he has worked so hard for will go where he wants it. And I know my husband, son, or sisters won’t have to shoulder the burden of sorting out my affairs when I die.
Talking about my death, as well as the demise of my father and husband, was hard. No one wants to have these difficult conversations. But knowing that we’ve done the unpleasant work to make sure our wishes are respected and our loved ones are protected upon our deaths is well worth the discomfort.
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