Monday, August 20, 2012

LTC-101 LEGAL: Estate Planning


With Long Term Care Insurance we are planning for the last years of life.  It is necessary to know the fundamentals of Estate Planning.

Please check with an attorney for more detail discussion on these terms.

Wills:
 A Will or testament is a legal declaration by which a person, the testator, names one or more persons to manage his or her estate upon his or her death and provides for the transfer of his or her property to specified beneficiaries

Trust:
The most common Trust is a Revocable Living Trust. It represents a private contract between the person or persons creating it and the person or entity they choose to be their Trustee. It does not require court involvement to authorize, create or oversee its administration. It is "Living" as it is prepared and used during the life of the person(s) creating it by transferring an asset into it also referred to as “funding” the trust. When it is funded, the trust is legally in existence and has "life". Once funded, the trust can serve many family and estate tax planning needs. Assets can be added to it at anytime, whether during your lifetime or upon death. The Trustee is responsible for holding, managing and distributing the assets in the trust based on the rules you establish when you create trust. A Trust can avoid the need for court involvement such as a probate.

Special Needs Trusts:
Special needs trusts allow a disabled beneficiary to receive gifts, lawsuit settlements, or other funds without losing eligibility for “needs based” government programs. The trusts are written so that the funds will not be considered available to the beneficiary when determining eligibility for public benefits.

Advanced Medical Directive:
They enable you to designate a trusted individual as your agent to carry out your specified health care decisions including the decision to maintain or withdraw life support in the event of your incapacity.

Powers of Attorney:
Allow a trusted person designated by you, to manage your financial affairs in the event of your incapacity. They can be very broad or limited to a specific transaction and can be drafted to last for a specified period of time or indefinitely

Medical-Planning:

Planning & Application:
 Medi-Cal is a needs-based medical government program in the state of California. It is based on disability and financial needs. The State program is administered by the California Department of Health Care Services, which is administered locally by the Department of Social Services. Attorneys assist  clients in gaining eligibility for Medi-Cal long-term care (for those who require skilled nursing care) as well as Medi-Cal for those who are residing in their own homes.

Estate Recovery: 
 After a Medi-Cal beneficiary passes away, the State of California is entitled to repayment for the benefits paid during the life of the beneficiary also known as estate recovery. It is critical that beneficiaries and their families discuss the regulations regarding estate recovery during the life the beneficiary to explore the ramifications of actions taken or not taken while their loved one is receiving Medi-Cal benefits.

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