As a reminder, Medicare only covers up to 100 days of nursing care. If you and/or your spouse need nursing/long-term care, you either:
1) Pay out of pocket (until your assets fall below a low threshold) and/or
2) Tap into your long-term care insurance (if you have it).
If you don’t have long-term care insurance, you pay “out of pocket” until most of your assets are spent down and Medicaid steps in as a last resort. If you’re married, all liquid assets must be tapped – regardless of who’s name appears on the account – until most of your combined net worth is spent down. Only then does Medicaid (an aid-based program) step in.
Wife and Husband got married 11 years ago, purchased a home together but kept their investment assets separate. Life was good until wife was diagnosed with Alzheimer’s Disease three years ago. Since then, husband engaged personal caregivers to help. Monthly caregiver bills now top $3,000/month.
The best way to safeguard their financial future and guarantee nursing care for wife is to divorce and only than would medicaid kick in to cover wife’s medical expenses. Husband would no longer be liable to pay wife’s medical bills after divorce. This is of particular concern since husband could live another 20+ years.