What is Medicaid Planning?
Medicaid planning is a process which involves finding ways to preserve and protect assets while getting Medicaid to cover medical costs and nursing home care. Medicaid is one of the only sources of payment for nursing home expenses, other than paying privately. It can also provide coverage for treatments with lower co-pays and co-insurance costs than Medicare and other private insurers. As a result, seniors and those who need to live in a nursing home and/or who require costly medical care may wish to qualify for Medicaid benefits.
There are two problems for seniors who want Medicaid to cover their care. The first issue is they may have to spend down a good portion of their personal wealth and even sell some of their assets before Medicaid begins to pay nursing home expenditures. This occurs because Medicaid is need-based and imposes a resource test.
The second problem is the possibility of Medicaid estate recovery. When someone over 55 or someone who lives full time in a medical care setting qualifies for Medicaid, the government requires estate recovery after death.
During the estate recovery process, efforts are made to recoup the costs spent on the person’s medical and nursing home care. Claims are made against the estate of the person who received the care and who is now deceased. This can prevent a person from being able to leave property and assets to loved ones.
Medicaid planning is meant to address these issues by changing the ownership of assets, changing the types of assets owned, and/or structuring asset ownership so that the property and money does not count as a resource for Medicaid purposes. An experienced Medicaid planning lawyer can provide assistance on using available tools and carrying out a comprehensive plan to get Medicaid coverage.
When Should I Start Medicaid Planning?
Medicaid tries to discourage people from just giving away or transferring assets to get nursing home coverage. As a result, Medicaid imposes a five-year lookback period. If you transferred property within five years, you could face a period of time in which you are disqualified from Medicaid coverage.
The length of your disqualification is determined by adding up the total cost of assets transferred in the past five years and dividing this number by the average local monthly cost of nursing home care. The resulting number from doing this calculation is equal to the number of months of disqualification. Someone who transferred $10,000 in assets, for example, could be disqualified from Medicaid coverage for two months in an area where the average monthly nursing home cost was $5,000 ($10,000/$5,000 = two months).
While you can still protect some of your assets if you have waited more than five years, this lookback period means you likely will have to use at least some of your resources during the period of disqualification. As a result, you should not wait to act.
How can Wesley Clark & Peshkin Help?
Wesley Clark & Peshkin can provide you with comprehensive assistance understanding Medicaid qualification requirements and Medicaid coverage options. We can advise you on whether Medicaid planning is needed in your situation and we can help you to put your plan into place. If you live in Rochester, Buffalo or Syracuse, give us a call now to get started at 888-222-4996. We will work hard to make sure nursing home bills don’t lead to the destruction of your legacy, so give us a call now to learn more.