PLANNING AHEAD: Consider state benefits for long-term care before moving [Column]

The 2020 U.S. Census report demonstrated some definite trends regarding Americans on the move. In an online article by Laura Mueller in moving.com, “Where Are People Moving To? Top Trends for 2022”, the author noted “an overwhelming push toward states in the South and West.”

The top 25 cities “seeing the most new residents” include a large representation from Florida. Percentage-wise by states, Utah — maybe surprisingly — showed the highest percentage increase in population at 18.37%. The largest population decrease occurred in West Virginia, which lost 3.2% of its population between 2010 and 2020. The states where populations are declining according to the article are: Illinois, Mississippi and West Virginia.

All of these issues could be taken into account when considering moving out of state — whether the area is growing, whether communities that provide good care are located nearby, and what benefits might be available and their accessibility.

Florida, of course, has long been known for retirees. The author notes that good weather and a lack of state income tax might have something to do with it. Pennsylvania, another state with a large number of seniors, does exempt retirement income including income from IRA’s and 401(k)’s from Pennsylvania’s income tax although Pennsylvania has an inheritance tax.  Florida also gives a generous homestead exemption for residents that can encourage out-of-staters with dual residences (for instance, Pennsylvania in summer and Florida in winter) to consider Florida their state of residence although they commute between both states. There can come a time when such commuters decide to settle entirely in one or the other.

Among all the issues up for consideration in making a move, one significant one is: What are the options when long-term care is needed. Reputation in long-term care circles has been that Medicaid in skilled nursing facilities is significantly easier to obtain in Florida than many states but care is sometimes criticized.

I have noted in prior columns over the years there are a number of Pennsylvania residents who move to Florida for retirement but return to Pennsylvania to be near family when they need care. Whether there is adequate appropriate care can sometimes also depend on local considerations. In rural areas in some states it may be difficult to locate nursing homes or senior communities able to meet demand.

With Pennsylvania, a concern among elder law attorneys over the years has been the difficulty in obtaining at-home care with financial assistance from the government. At-home assistance in Pennsylvania to any significant degree has been limited primarily to individuals with low or very low income and even then paperwork requirements can be daunting.

We do have many good and excellent personal care and memory care communities here where residents pay privately, although care can be expensive. We also have continuing care retirement communities, some of which, at the highest level of care, have Medicaid as a possible source of payment.

Private availability, taxes, and government and private programs can vary widely from state to state and even among local jurisdictions. States can differ dramatically when it comes to long term care regarding availability, quality, government benefits, retirement communities, and cost.

There are also significant differences in qualification for benefits. If you live in Pennsylvania and receive long term care services and supports here, whether in a nursing home or at home under the Medicaid Waiver Program, your spouse’s retirement funds — IRA, 401(k), 403(b) or similar — (not yours) are exempt for Medicaid regardless of the amount. However, in New Jersey they are counted and would be spent down as part of the Medicaid spenddown. The difference to the couple can be sizeable.

California is very open in its interpretation of the Medicaid gifting rules.  Pennsylvania allows $500 total per month without penalty. New Jersey counts gifts in any amount.

So what is the answer? Before moving, this is one additional consideration to add to the list. We often research the laws and regulations in other states and contact elder law attorneys in the area of interest. A national organization, the National Academy of Elder Law Attorneys (NAELA) to which we belong provides further connections with attorneys specializing in the field for information. Whenever and wherever you move — or if you decide not to — there are answers that can assist you in making the decision.

Janet Colliton Esq. is a Certified Elder Law Attorney by the National Elder Law Foundation and limits her practice to elder law, retirement, life care, special needs, and estate planning and administration with offices at 790 East Market St., Suite 250, West Chester, [email protected] She is a member of the National Academy of Elder Law Attorneys and Pennsylvania Association of Elder Law Attorneys and, with Jeffrey Jones, CSA, co-founder of Life Transition Services LLC, a service for families with long term care needs.

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