Yes, elder law can help with Medicaid eligibility. Elder law attorneys are well-versed in the legal aspects of Medicaid regulations and can assist with spend-down planning, asset protection, and look-back period management.
The assistance of a skilled elder care attorney is especially important when planning for long-term care. Mistakes can trigger a penalty period and a delay in your Medicaid eligibility. In many cases, this means paying out-of-pocket for your care until eligibility is restored.
A Texas elder law lawyer can help you understand Medicaid eligibility rules and get the benefits you deserve.
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What Is Medicaid?
Medicaid is a government program that offers health coverage to low–income individuals and families. Jointly funded by federal and state governments, it provides for medical services such as hospital care, doctor visits, and long-term care.
Unlike Medicare, which is primarily for those over 65 regardless of income, Medicaid eligibility depends on financial need. This puts some people in a position where they must
spend down their assets in order to qualify.
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Who Is Eligible for Medicaid?
Each state administers its own Medicaid program under federal guidelines, so benefits and rules can vary. Generally, you must be a resident of the United States and the state where you are applying.
There are also requirements for income, age, and type of disability. The specifics change periodically, so it’s a good idea to consult with an elder law attorney to be sure you understand the current regulations.
Remember that Medicaid is intended for people with limited means. If you have significant assets, you will not qualify. This can create a conundrum if you need to apply for Medicaid for a long-term nursing home stay.
Why Do I Need Medicaid in Long-Term Care?
Nursing-home care is expensive. Medicare will often cover qualifying short-term skilled nursing facility care, but after that, you must pay out of pocket. Even if you have a good income, you may not be able to afford the full cost of care each month.
To make up the difference, you can apply for Medicaid, which will cover your costs. First, however, you have to qualify. For many people, qualifying for Medicaid means spending down their assets so they meet the thresholds.
What Is the Spend Down?
If you require Medicaid but don’t meet the asset threshold, you must disperse your assets until you are eligible. Paying for your nursing home care out-of-pocket for several months may reduce your savings enough to do so, but there could also be other concerns, such as your home.
Elder law can help with Medicaid eligibility by forming a plan to spend down your assets while potentially protecting things like a family home. However, it is important to realize you can’t just give assets away. Medicaid considers not only your assets today but also over a look-back period.
What Is the Look-Back Period?
When Medicaid reviews your finances to determine your eligibility, it will look back five years to find out if you sold or gave away any major assets. Any sales must have been made for fair market value; otherwise, you could incur a penalty period.
For example, if you sell your home to a family member for a dollar and need to apply for Medicaid a year later, that sale will harm your eligibility. Had you sold your home for fair market value and accounted for the proceeds, your eligibility would likely remain intact.
What Is the Medicaid Penalty Period?
With the exception of outright fraud, running afoul of Medicaid rules usually doesn’t mean you’re forever ineligible. What it does often mean is that you have to wait through a penalty period until you are eligible.
Medicaid determines your penalty by dividing the value of the assets you misallocated by the average cost of long-term care in the state where you live.
If you have given away your house that is valued at $100,000 and nursing care costs an average of $10,000 per month in your state, you will need to endure a 10-month penalty period until you are eligible for Medicaid.
Can I Protect My Assets from Medicaid?
Some asset transfers are allowed under specific exemptions, but most gifts can affect eligibility. If you are considering Medicaid eligibility, it is important to speak with a lawyer to be sure you aren’t making any mistakes.
An elder law attorney will also understand various methods of protecting your assets, like your home, through strategies such as trusts and estate deeds. Often, this requires some forward thinking and planning long before you may need Medicaid.
When Should I Start Considering Medicaid Eligibility?
It’s a good idea to consider estate planning and the potential need for Medicaid once you hit your 50s and 60s. While you hopefully won’t need it for a long time to come, speaking with a lawyer sooner rather than later means you will understand the process and be ready.
Too often, seniors avoid planning for medical eligibility until it is too late. While it is understandable that you don’t want to think about losing your home or moving to a long-term care facility, failing to prepare for the possibility may put you in a difficult position when you do need to apply.
Get Help With Your Medicaid Eligibility
Elder law can help with medicaid eligibility, and elder law attorneys have the experience and knowledge to guide you down the right path. While many of the rules may seem confusing, it is important to get assistance so you don’t risk your eligibility.
At Marc Whitehead & Associates, our team has over 120 years of combined experience. Contact us today for a consultation and learn how we can help.