Understanding Long-Term Health Care
May 09, 2014 | 3227 views | 2 2 comments | 12 12 recommendations | email to a friend | print

Long-Term Care Crisis Prompts More

Aggressive Collection Tactics

Insurance Industry Expert Shares Tips for Protecting

Your Family from “Filial” Support Laws

Most people do not understand filial support laws, which are spreading to more states – 28 and counting, says insurance industry expert Chris Orestis.

“We’re living longer, but for many of us, that also means we’ll require some type of  long-term health care at some point,” says Orestis, a longtime industry insider and author of “Help on the Way,” (http://ebook.lifecarefunding.com/), which explains the problem of funding long-term care and offers solutions.

“It’s a problem no matter what your age because we’re experiencing a “Silver Tsunami” of retiring baby boomers and the costs of long-term care can be extremely high. Medicaid is the only option for many seniors, and that’s straining the funding for that safety net. Many people are not eligible for Medicaid, but also cannot afford the expense of care.”

As a result, long-term care providers and the federal government are bringing lawsuits and mandating claw-back actions against families, insurance companies and legal advisors, he says. Many are turning to filial support laws, which impose a duty upon adult children for the support of their impoverished parents. Medicaid also has the right to sue families in probate court to “claw-back” funds spent on care.

Just one recent example involved John Pittas, a 47-year-old restaurant owner who was sued by a nursing home company for $93,000 in expenses incurred by his mother over a six-month period after she was denied Medicaid eligibility. 

“The court finding even granted discretion to the nursing home company to seek payment from any family members it wished to pursue,” says Orestis.

To avoid a financial catastrophe, he says families should consider these options:

•  Know your and your family’s health-care rights as a veteran. Veterans who have honorably served their country should take advantage of their VA benefits – not only for their well-being, but also for their family’s health. Additional programs that may apply to family members include the VA Civilian Health and Medical Program (CHAMPVA), a comprehensive health-care program in which the VA shares the cost of covered services and supplies for eligible beneficiaries; the spina bifida health-care benefits program for certain Korea and Vietnam veterans' birth children; and TRICARE, another health-care program serving uniformed service members, retirees and their families.

•  You can convert your life insurance policy for long-term care. There is $27.2 trillion worth of in-force life insurance policies in the United States, according to the National Association of Insurance Commissioners – that’s triple the amount of home equity today! Rather than cancel or drop a policy to save on premiums when faced with long-term care needs, you can use it to pay for home care, assisted-living or nursing home expenses. “I’ve been lobbying state Legislatures to make the public aware of their legal right to use this option,” says Orestis, CEO of Life Care Funding, (www.lifecarefunding.com). Seniors can sell their policy for 30 to 60 percent of its death benefit value and put the money into an irrevocable, tax-free fund designated specifically for their care.

•  Don’t be so quick to attempt to qualify for Medicaid. Many people who need significant long-term health care can’t afford it, so they drop life insurance policies that they’ve been carrying for years in order to qualify for Medicaid. Families often turn to Medicaid to pay for nursing home care, but it comes with many restrictions, including choice of facilities. In a situation where one spouse is healthy and the other is not, the spouse living independently will also face restrictions on the amount of assets he or she can retain, for instance, a maximum $2,898.00 for monthly maintenance.

About Chris Orestis

Chris Orestis, nationally known senior health-care advocate, expert, and author is CEO of Life Care Funding, (www.lifecarefunding.com), which created the model for converting life insurance policies into protected Long-Term Care Benefit funds. His company has been providing care benefits to policy holders since 2007. A former life insurance industry lobbyist with a background in long-term care issues, he created the model to provide an option for middle-class people who are not wealthy enough to pay for long-term care, and not poor enough to qualify for Medicaid.

Comments-icon Post a Comment
Robert White
May 12, 2014
A lot of people are not familiar with filial laws which often catches them off guard. There are many states today that ask older adults to take the responsibility of paying for their parent's long-term care expenses. They can be sued if they don't pay for these expenses. So I agree with you that families should consider the options enumerated here in order to avoid financial catastrophe. This time around, long-term care insurance is not your only payment options because there are also other alternatives available nowadays. Since long term care insurance is expensive according to www.ltcoptions.com/long-term-care-insurance/, which would cost your around $1,000 to $8,000 annually. There are some people who can't afford this and these people are encouraged to explore their options like government programs, hybrid products, reverse mortgage and annuities.
Raymond Lavine
May 10, 2014
Understanding the consequences of not having an extended care plan involves the issues by Chris Orestis.

There are benefits available: Long Term Care Insurance, Criticial Care Benefits, True Freedom home care services, and Life Insurance with LTC benefits.

These benefits will do what self-insuring, family and friends, and other benefits cannot do -- it will not be disruptive to those you love and those who love you. It will preserve your estate and cash flow for your commitments before and during retirement.

It will keep you at home longer or perhaps until the end of your life. There is nothing wrong with a quality care facility -- it is by choice or circumstances.

Many times, people go to a care facility because family care givers are exhausted or physically and emotionally not able to continue partial or full care giving.

You are no more than 1 or 2 people away with knowing someone who is a care giver or needs care giving. Look around you at restaurants, shopping, or when traveling. People are in wheel chairs, walkers, and canes. Many need some form of care giving.

Raymond Lavine

Gig Harbor, Washington