The last difference @CFP mentions is potentially meaningful. If I remember correctly, qualified plans provide much stronger protection against creditors than IRAs. This is relevant for people who might be sued (never happens to anyone in the US 
) or in the case of bankruptcy. I donāt believe ERISA protects the person from the IRS, spouses in a divorce, or when figuring out eligibility for Medicaid for nursing homes, but I am no expert in this.
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People on this thread may have handled the financials for relatives/parents who have needed to be in long term skilled care (nursing home) and spending down their assets. FIL and DHās grandfather both were in long term care under Medicare/Medicaid along with their SS payments less a monthly stipend for personal expenses. MIL, while remaining in the home, was able to keep the home, her pension, her SS.
IDK if this still holds true, but for assisted living Morningside chain, at one time if one spouse needed assisted living, the spouse could share accommodations and they only paid the cost for the one needing assisted living. I saw that as a great benefit - the active spouse could come and go with the car and also take their spouse out. The one close to us was well managed and had 100% occupancy and waiting list.
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This option would have made all the difference for several of our late relatives. Iād be willing to pay extra if necessary.
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My in lawsā AL had a very nominal charge for the second person. They lived together until my FIL passed, and the additional charge for MIL, who was at the time considered independent, was quite reasonable. I havenāt had other experience with AL facilities, so I didnāt realize that thatās possibly not common.
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My dad is in an assisted living facility. The additional cost if my mom was there would be nominal. Though she passed away (ironically the day before we had a meeting with the same staff, where she was on a rehab stay, to talk about her next steps which likely were to move into that same facility on assisted living). Not sure how common that is but it makes sense.
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Does anyone here have any familiarity with a, āMedicaid Trustā?
A friend of mine is looking into this with an elder law attorney. It seems to require the parents to establish an irrevocable trust with her and her brother as trustees that has to be in existence for one year, but after that time her parents can claim Medicaid irrespective of the amount in the irrevocable trust. I have no idea if these are dependent on state, if itās legitimate, or what. Seems rather sketchy to me - like fraudlike?? 
But seems to be a way to keep from having to spend down assets.
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It also probably does not cost the assisted living place that much, since the present spouse likely reduces the demands on staff that the one needing assistance requires.
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My parents attorney said the Medicaid laws on spend downs are very, very strict. I would think that would raise lots of red flags.
Also seems like fraud to me.
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I think this is sketchy and not legal. Medicaid rules are laid out so people pay for their care when they can.
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Yes you are right, but so many places want to get as much profit as they can, so often a couple pays more than they should when only one needs the assisted living situation. It is partially what the market will bear and how much competition there is. Sometimes the sales pitch; sometimes it is a new shiny facility and people fall in love with a particular facility.
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I googled āmedicare trust scamāā¦. and sounds like scam
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Seems legit because the parents are irrevocably giving up control of their assetsā¦similar to gifting away their assets.
The 1 year period is much too short however. Medicaid Asset Protection Trusts violate Medicaidās look back period if not set up at least 5 years (2.5 years in California) before the person applies for long-term care Medicaid.
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Itās for Medicaid not Medicare.
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Thanks for that link. I had also thought one year seemed very short.
None of my business, but I do wonder what my friend is being told??
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Looks like it depends on how the trust is structured and can be a perfectly legal asset protection strategy, but it apparently requires more than one year look back. I would ask another attorney licensed in the state where the person lives for a second opinion!
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They are a real thing, and can be legit or not. The utility varies from state to state, and you really need to talk to a specialist attorney in your area to figure out if it is right for you. There are trust mill attorneys who do them, so be wary.
In California (the state I know), there is almost no reason to do one. There are better options. Other states, though, I think they are pretty common.
I am not a fan, personally, because I really donāt like older folks giving up control over their own assets a second sooner than absolutely necessary. Itās their hard-earned stuff! It doesnāt sit right with me philosophically to impoverish someone, even if the kid is totally trustworthy. But that said, I have written them before when it was the best option. It almost never is where I am.
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Iām just coming back to reiterate that a Medicaid trust is not something I am doing or that anyone in my family is doing or that I have talked to an attorney about. So, donāt need to seek a second opinion from anyone. 
A friend of mine brought it up, so technically, I probably shouldnāt have asked about it as itās not directly related to me at all. And, Iām not going to give her any advice about it as she hasnāt asked me for any. It just made me curious because it sounded, āwrong,ā to me.
My question about Medicaid trusts was simply intended as a general inquiry related to retirement/estate/end-of-life planning. Since there was recent discussion about AL and spending down assets - I thought bringing it up might be relevant.
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This might be tangential, but a Special Needs Trust is valid. I was financial POA for a friend with a rare genetic disease who became disabled in her 40s. My joint POA set this up for her and it was fantastic, as it covered items and treatments that improved quality of life for her after the spenddown. You need to be under 65 when it is set up, with a disabling condition. After death, SS is paid back from the remainder, but there was extra that went to her heirs. I remember being impressed that the reimbursement was not as much as I anticipated. The trust was set up long before she went into care. Oh, she was angry about her money being tied up, but it really helped her and her family in the end.
Thinking about it, this would have been useful for my ex who became disabled due to dementia prior to age 65, had he ended up in long term care.
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Good benchmark to know that it needs to be set up before 65/Medicare. Special Needs Trust.
We donāt need (and we are both 65), but in the future, you never know with a family member.
What a good friend you were to do the POA. 
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