Jul 26

Domestic Partners and Long Term Care Planning

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DOMESTIC PARTNERS AND LONG TERM CARE PLANNING

By Neil A. Harris, Certified Elder Law Attorney

While most of us are familiar with the term “Domestic Partners,” many believe that Domestic Partnerships are available only to same sex couples.  Actually, both same sex and older heterosexual couples can take advantage of Domestic Partnerships.  In fact, many older persons find entering into a Domestic Partnership with their later-life partner easier and more advantageous than the more traditional formal marriage.

In 2003, the California legislature passed Assembly Bill 205 (AB205) which provides for the same rights, protections and benefits of spouses to Domestic Partners.  Domestic Partners are defined  as, “two adults who have chosen to share one another’s lives in an intimate and committed relationship of mutual caring.”  The actual Partnership can be established when both persons file a Declaration of Domestic Partnership with California’s Secretary of State and at the time of filing, meet all of the following conditions:

  • Both persons share a common residence
  • Neither person is married to someone else or is a member of another Domestic Partnership
  • The two persons are not related by blood or in a way that would prevent them from being married to each other in California
  • Both persons are at least 18 years of age
  • Both persons are capable or consenting to the Domestic Partnership
  • Either of the following:
    • Both persons are of the same sex, or
    • Each person is of the opposite sex of the other and one of the two is over the age of 62 years at the time of filing

Once the Partnership is established, both Partners are treated in the exact same manner as traditional married spouses under California law.  In fact, most existing California law has been amended to include Domestic Partners in the statutory definition of “spouses.”

Termination of a Domestic Partnership is a formal process, but may not require the filing of a proceeding of dissolution as in the more traditional marriage.

While many same sex couples consider Domestic Partnerships as the only available option to marriage  in California following the California Supreme Court’s recent Proposition 8 decision, a growing number of elderly heterosexual couples view Domestic Partnerships as a more practical solution to traditional marriage.  Since a California Domestic Partnership only effects State law, it is possible that older couples can live in a relationship sanctioned by their State government without adversely affecting any federal benefits earned by either Partner or the previous spouse of either Partner.

While the above State/Federal law distinction may protect the federal benefits belonging to each Partner, that same distinction may serve as a disadvantage should either of the Partners require Medi-Cal Long Term Care benefits.

Since the Partnership is not recognized under federal law, Domestic Partners are considered unmarried individuals and, therefore, subject to the asset transfer and limitations imposed on a single person.  For example, while married persons may freely transfer assets between each other without subjecting those transfers to a Look Back Period or Penalty Period, with few exceptions, the transfer of Medi-Cal non-exempt assets between Partners will result in the imposition of a transfer penalty should either Partner require placement in a skilled nursing facility within thirty (30) months of the transfer.

As to assets limits, a married couple may protect up to $109,560.00 of Medi-Cal non-exempt assets should one of the spouses be placed in a skilled nursing facility (Community Spouse Resource Allowance).  In addition, the non-institutionalized spouse (Well Spouse) is entitled to retain a monthly income allowance of, at least, $2,739.00 from all of the income of both spouses (Minimum Monthly Maintenance Needs Allowance).  All of an institutionalized Partner’s monthly income, with the exception of $35.00 for personal needs and the monthly cost of the ill Partner’s Medicare supplementary insurance, is paid to the skilled nursing facility as the ill Partner’s share of cost.

And finally, in a more traditional marriage, the Well Spouse can seek a Court ordered increase to his/her Community Spouse Resource Allowance where the fixed income available to that Well Spouse alone is less than his/her Minimum Monthly Maintenance Needs Allowance.  No such increase is available to the non-institutionalized Partner.

Obviously, the issue of Domestic Partnership offers both advantages and disadvantages to the participating Partners.  As same sex Partners do not have a current option, this is especially true where an elderly heterosexual couple are the Partners.

As with most complex issues, it is always advisable to seek legal counsel prior to entering into any partnership.

 

For more information, please visit: http://www.leginfo.ca.gov/pub/11-12/bill/asm/ab_0601-0650/ab_641_cfa_20110421_172524_asm_comm.html