What is the best way to protect my mother's assets? She is moving into a retirement home.
You will want to seek out an attorney who practices in the area of Medicaid (not Medicare) law. This is a very specialized area of practice, so beware! Ask the attorney how much of his or her practice is devoted to Medicaid work. For some general information, take a look at “Questions and Answers on Medicaid for Nursing Home Residents,” a very helpful publication you will find at www.washingtonlawhelp.org (look under the Aging/Elder Law tab).
It's funny how many of us, including myself, immediately assume that seniors are trying to find ways to apply for public assistance (medicaid). Based on the information provided, it does appear that medicaid planning is what is requested. However, protecting assets can mean many things for seniors. It can mean protection for probate courts. It can mean protection for unwanted litigation. It could mean protection from stock market and interest rate fluctuations. The fact that someone moves into a retirement home suggests a concern for paying that retirement home, but in my experience, retirement homes will not accept you unless you have the wherewithall to pay in the first place. So this immediately places the mother in a category of having sufficient assets for paying, at least for awhile. The key here is to consult with an experienced estate planning attorney who can guide your mother as to what her primary objectives are. Asset protection comes in many forms and some techniques are based on state law, and some require some anticipated planning, and some techiques may be too late to employ. Keep all the options available and don't assume that medicaid qualification is the sole solution. Hope this helps.
My suggestion is to think first about what your priorities are. There is no guarantee that good care will be provided in a nursing home so you will want to think about whether you are preserving assets to ensure good care for your mom or whether you are preserving assets for her heirs. While many Elder Law Attorneys can address the asset protection issues, lawyers working with Law firms that are members of the Life Care Planning Law Firms Association will be better prepared to address both issues. The real question you are asking is whether you can get someone else to pay the high cost of long-term care. The only public benefits program that does this is Medicaid. The Medicaid program is a "means tested" program which, in plain English, means they look to see whether your mom is "poor enough" to qualify. Elder Law Attorneys routinely assist families in gaining Medicaid eligibility, but the rules are different in every State so you will need to hire an Elder Law Attorney familiar with the rules in your State. Planning for Medicaid eligibility is complicated stuff so I don't suggest trying this at home. Also, be wary of salesmen who are selling gimmicks such as annuities. This is not to say that a product will or will not work, but when you are dealing with someone who focuses on a particular product its like dealing with a hammer salesman (e.g., every problem looks like a nail).
It is important to know all of your options when a parent or spouse requires some form of long term care. It is well worth your time to consult with a local (within your state) Elder Law Attorney. As stated by others, this is a highly focused area of law. A general practice attorney, and even an estate planning attorney, often will not be fully versed in all of the options available.
At a minimum, the attorney should be a member of the National Academy of Elder Law Attorneys (NAELA). You may want to seek out a Certified Elder Law Attorney (CELA). However, the attorney must be from your state. The laws and regulations vary widely from state to state.
Finally, there has been some discussion here that implies that an Elder Law Attorney is a Medicaid Attorney. A good Elder Law Attorney does so much more than simply help people qualify for Medicaid. There are often options to explore such as Veteran's Aid & Attendance benefits and other state programs for seniors. However, the reality is that because of the cost of long term care many people will run out of money and require Medicaid. Under the Deficit Reduction Act of 2005, you could very easily run out of money and still be disqualified from receiving Medicaid for a period of time. Therefore, it is critical that you consult an Elder Law Attorney before you run out of money or complete a spend-down.