You plan for retirement, you plan for significant expenses, but what about Medicare planning? Most individuals under the age of 65 do not think of Medicare until it is too late. Ideally, you want to start planning for Medicare benefits long before you need them. Doing so can ensure you are not only approved but have access to the benefits you need quickly when you need them.
Medicare Planning Is Critical for Your Financial and Health Well-Being
One of the more significant decisions you will make while you near retirement is regarding your Medicare plans. You want to access all of the benefits and supplement options you can. Otherwise you will be paying out of your retirement fund for medical costs. Medicare planning means taking time to sit down with an estate planning attorney to look over your options and prepare for those unexpected costs.
What Is Medicare and Do I Need It?
Medicare is a government health insurance program managed by the federal government. When you reach age 65 or older, you are eligible for Medicare insurance benefits (some with qualifying disabilities or end-stage renal disease can receive Medicare before age 65).
Medicare has multiple parts, and when you go into a planning meeting with an attorney, they will go over each and help you understand which ones you’ll need for your healthcare in the future.
- Part A: Part A is your hospital insurance plan, but it only covers admission into a hospital or skilled nursing care facility. You do not have a premium for this plan.
- Part B: Part B is your actual medical insurance, which handles doctor’s office visits, laboratory tests, outpatient procedures, and more. You do have a monthly premium for this portion.
- Part D: Part D is optional but highly recommended as it covers your prescription drug costs, and you do have a premium for this plan.
Why Medicare Planning Is an Important Step in Retirement
Healthcare is one of the most overlooked expenses when people plan for retirement. They think of their health situation right now rather than the likelihood that it will decline during their retirement. Medicare costs and the benefits you plan to use are critical parts of your retirement plan. In fact, they should be part of your estate plan.
When you start thinking about your future, your estate plan is one of those steps you are already taking to protect yourself and your loved ones. While estate plans are often thought of as a component for after death, they do protect you while you are still alive.
In fact, you can set up a trust today that will help you now and into the future when you hit retirement. Likewise, that trust is there to provide for your loved ones if you were to pass away.
Does My Income Affect Medicare?
Medicare is not the same as Medicaid. While Medicaid is asset and income-based, your Medicare benefits only require that you have a qualifying disability or that you are over the age of 65.
Creating Durable Powers of Attorney
While you are doing Medicare and retirement planning, one critical step to take is your durable powers of attorney. You could designate a friend or family member to make all legal and medical decisions on your behalf if you were to become incapacitated. They can also access your Medicare benefits so that you can use them while you receive medical treatment, and they can pay for your premiums to keep your Medicare coverage alive as well.
Make sure you pick a person that you can trust to handle all financial and healthcare-related decisions on your behalf. You will want someone who can think through critically, honor any wishes you might have about life-saving care, and who is responsible enough to handle your finances while you are unable to do so yourself.
Setting Up a Trust
You can create a trust to protect your assets while you perform retirement and Medicare planning with an attorney. A trust puts your assets into a single account and can include everything from bank accounts to property and even your life insurance policy. You are in charge of your trust’s assets while you are alive, including the ability to move them in and out of the trust, and use the assets in your trust for your living expenses. Once you pass away, the beneficiaries you name in the trust will receive their distributions per your allotment request. One benefit to setting up a trust is that, if you do pass away, your loved ones can skip the hassle, cost, and time consumption of going through probate court as well.
Do You Need an Attorney for Medicare Planning?
While you do not need a lawyer to plan for Medicare, you do need one who can help establish your estate plan, make your durable powers of attorney, and create a trust. Even if you do not plan to create a trust, you need a will drafted that will tell loved ones who inherits what and your wishes for burial.
Regardless, meeting with an attorney is beneficial if you need to plan for retirement and determine how you will care for your loved ones. One of the biggest advantages is that you can make sure you set aside funds in a trust to pay for medical costs not covered by Medicare, such as nursing home care. While you are covered for skilled nursing facilities and hospitalizations, your Medicare benefits will not cover long-term nursing home or in-home nursing home care.
By planning ahead, you can work your assets so that you will qualify for Medicaid, which helps pay for additional care as you get older.
To explore your options and make sure you and your family are protected, schedule a free case evaluation with the Law Office of Andrew M. Lamkin today. You can schedule your appointment at 516-605-0625 or request more information online about our estate planning and retirement planning options.
Andrew Lamkin is principal in the law firm of Andrew M. Lamkin, P.C., where he focuses his practice in the areas of elder law, estate planning and special needs planning, including Wills and Trusts, Medicaid planning, estate administration and residential real estate transactions. He is admitted to practice law in New York and New Jersey.
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