Planning Ahead for Long-Term Care Can Help Protect a Family’s Wealth

 Posted on October 16, 2026 in Estate Planning

A stay in an Illinois nursing home for one year now costs about as much as a new pickup truck. Many elderly people or others who need long-term care may need to stay in nursing homes or assisted living facilities for several years. The expenses involved in nursing home care can quickly drain a lifetime of savings, affecting the inheritances that were meant to be left to children or other family members.  parents hoped to leave behind. However, families can take steps to avoid these losses by planning before a health crisis occurs.

Planning for long-term care can protect a family's wealth by making arrangements ahead of time to address the costs of care, avoiding the need to spend savings to do so. With the right mix of insurance, legal documents, and Medicaid planning, a person can preserve assets and provide for the needs of their spouse and children or grandchildren while still getting quality care. The key is timing. Many of the most useful tools only work if they are put in place years before care is needed. Legal help from an experienced attorney can ensure that a family will have the proper plans in place.

When Will a Person Need Long-Term Care as They Get Older?

Long-term care may be necessary to provide help with everyday living and medical care over an extended period of time. It may address things like bathing, dressing, eating, moving around, and taking medications. Care may be provided at home, in an assisted living community, or in a nursing home.

According to the U.S. Department of Health and Human Services, around 70 percent of people over the age of 65 will need some type of long-term care during their lifetimes. Common reasons why long-term care may be needed include:

• Alzheimer's disease or other forms of dementia, which often require years of supervision

• A stroke that affects a person’s movement, speech, or the ability to live alone

• Chronic conditions such as Parkinson's disease, heart failure, or diabetes

• A serious fall or hip fracture that leads to a long recovery or permanent loss of mobility

• General frailty that makes daily tasks unsafe without help

How Can Long-Term Care Costs Affect a Family's Wealth?

Many people may assume that Medicare or health insurance will cover long-term care. In most cases, these forms of coverage will not apply to long-term care. Medicare generally only covers short stays in a skilled nursing facility after a qualifying hospital stay of at least three days. Ongoing help with daily living, which is what most long-term care involves, is not covered by Medicare at all. Without proper coverage, a family may need to pay expenses for long-term care out of pocket until they run out of money.

What Does Long-Term Care Cost in Illinois?

According to surveys performed by CareScout, the median yearly costs for long-term care in Illinois are roughly:

• $82,368 for a non-medical caregiver at home

• $74,628 for an assisted living community

• $99,645 for a semi-private nursing home room

• $110,595 for a private nursing home room

How Can Medicaid's Spend-Down Requirements Affect a Family’s Savings?

Nursing home costs and other long-term care expenses may be covered by Medicaid benefits. However, Medicaid is designed to provide assistance for people who have limited financial resources. In Illinois, the asset limit to qualify for Medicaid long-term care benefits is $17,500 as of May 12, 2023. A person who is applying for benefits can generally have no more than $17,500 in countable assets, which include things like bank accounts and investments.

If a person’s countable assets are higher than the limit, they will be required to "spend down"  their assets. This generally means they will need to use their savings to pay for care until they fall under the limit. Without planning ahead, the spend-down requirement can wipe out money a person worked decades to build.

What Happens to the Spouse of a Person Who Needs Long-Term Care?

Illinois law offers some protection for married couples, with rules that are meant to prevent "spousal impoverishment." A spouse who stays at home while the other spouse receives long-term care is called the "community spouse." As of 2026, the Community Spouse Resource Allowance (CSRA) in Illinois allows a spouse to keep up to $143,172 in countable assets. The Community Spouse Maintenance Needs Allowance (CSMNA) will also allow a spouse to keep up to $4,066.50 in monthly income.

What Steps Can a Family Take to Plan for Long-Term Care?

Multiple options for long-term care planning may be available depending on a person’s age, health, and income, as well as their goals for their family. Some common tools that families may use include:

Long-Term Care Insurance

An insurance policy may help pay for care at home, in an assisted living facility, or at a nursing home. Premiums for long-term care insurance may be lower when it is purchased when a person is younger and healthier, often in their 50s or early 60s.

Transferring Assets Before the Medicaid Look-Back Period

In Illinois, any assets a person transferred to another party during the five-year look-back period before applying for Medicaid long-term care benefits could affect their eligibility. The state will review any gifts or transfers made during this period, and penalties may be assessed, or Medicaid benefits may be denied. Planning ahead by more than five years can help ensure that a person can receive Medicaid benefits when long-term care becomes necessary.

Irrevocable Trusts

A person’s assets may be placed in a trust where they will be managed by a trustee and used to benefit the person or other family members. An irrevocable trust is one that generally cannot be changed or canceled once it is created. Trusts can be created to ensure that assets will not be countable when determining eligibility for Medicaid.

How Does Long-Term Care Planning Fit Into a Family’s Estate Plan?

An estate plan can help ensure that the right decisions will be made about a person’s assets, medical care, and other issues. While the estate planning process will often involve decisions about how a person’s assets will be distributed to their beneficiaries, a person and family can also determine who will manage a person’s money and assist with health decisions. Long-term care planning is an important part of a comprehensive estate plan. Issues that families may need to address when they address concerns about long-term care include:

Powers of Attorney

A person can use powers of attorney to name someone who can handle their finances and health care decisions if they may need assistance in the future. A financial power of attorney can be especially important for long-term care planning. The agent named in a power of attorney can be given the authority to apply for Medicaid benefits, use assets to cover certain expenses, or sign legal documents. Without a power of attorney, a family may have to go to court and ask a judge to appoint a legal guardian. That process can be slow and costly.

Wills and Trusts

A will, a living trust, and other types of trusts will need to work together with plans for long-term care. For example, a will that leaves everything directly to a spouse who may need to live in a nursing home at a later time could result in that inheritance being spent on long-term care expenses. This could prevent a couple’s savings from being preserved and passed to children or grandchildren. To avoid this, a trust may be created to provide for the needs of a person’s surviving spouse while protecting funds from being spent down to qualify for Medicaid.

Beneficiary Designations

Retirement accounts and life insurance policies will pass directly to named beneficiaries. A person will need to review the forms designating different beneficiaries to ensure that these decisions align with an overall estate plan and will not affect Medicaid eligibility.

Updating an Estate Plan Over Time

For families that are planning ahead to address long-term care and other estate planning issues, updates to Medicaid limits and allowances in Illinois may need to be considered. A plan that was created 10 years ago may no longer fit the current laws or address a family's needs. Reviewing an estate plan every few years or after major life events can make sure the proper preparations are in place to preserve family wealth while meeting the needs of different family members.

When Should a Family Start Planning for Long-Term Care?

The best time to start planning is well before care may be needed. Ideally, a person will begin thinking about long-term care in their 50s or early 60s. Addressing these issues while they are still healthy and have more choices can make sure the right steps will be taken to protect family wealth and provide for their needs in the future. However, even if a person is already receiving care, a variety of options may be available to help protect against the loss of savings, support a person’s spouse, or address other needs.

Contact Our Yorkville, IL Long-Term Care Planning Attorney

Paying for a nursing home or other forms of long-term care can affect everything a family has worked to build. With thoughtful planning, a person can protect their savings, their home, and the future of themself and their loved ones. At Gateville Law Firm, our Plainfield long-term care planning lawyer can help a family create a plan that will fit their needs. Call 630-780-1034 to schedule a consultation.