When it comes to Medicaid planning, there are so many options to choose from. It is never too late to get started and your Medicaid lawyer can point you in the right direction. Here are brief answers to many of the most common questions regarding Medicaid planning. If you believe you may need Medicaid benefits in the future, our Medicaid planning attorneys can help you be prepared.
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A Medicaid Trust is a specific type of trust used to protect a Medicaid applicant's property so that he can maintain his eligibility for Medicaid benefits. A Medicaid Trust is an irrevocable trust that allows you to be the income beneficiary while identifying residual beneficiaries who will receive the trust property after your death.If you have questions regarding Medicaid planning matters, please contact the experienced attorneys at Gaughan & Connealy for a consultation. You can contact us either online or by calling us at (816) 974-3030. We are here to help!
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In cases where someone is not initially eligible for Medicaid because they do not meet asset limitations, there is a possibility of “spending down” assets in order to attain Medicaid eligibility. If you think this may be something you need to consider, discuss your situation with a Medicaid attorney first. Spending down assets basically means using your countable assets to pay off debts or expenses, instead of paying for nursing home care. However, this must be done in a very particular way in order to avoid the potential penalty period for fraudulent transfers.
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Medicaid requires that covered health care services be deemed “medically necessary,” which means that nursing home services may not always be included. Instead, Medicaid will only pay for nursing home care when it can be shown that the requested services are reasonable and necessary to protect life, to prevent significant illness or disability, or to alleviate severe pain.
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A common misconception with regard to Medicaid is that you will need to give away all of your property before you can qualify for Medicaid benefits. As a result, one may mistakenly believe that one can transfer property to family members in order to reduce one’s estate. The problem is, you cannot simply give away your property when you decide to apply for Medicaid.In fact, there was a law passed in 2005 which created a period of ineligibility for anyone who transferred their property to someone else at any time within five years of submitting their application for Medicaid benefits. Because the period of ineligibility begins when you actually apply for Medicaid, timing is very important and creating a Medicaid plan early is crucial.
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In determining Medicaid eligibility, assets are basically divided into two categories: countable or exempt. Countable assets are those that could be used to provide for your care, including cash, bank deposits, IRA’s, Keogh plans, pension funds and annuities, securities, cash surrender value of life insurance policies. Exempt property generally includes your residence (up to a certain value), household items, burial policy or a certain amount of cash set aside for burial expenses, automobiles, personal Items such as clothing and jewelry. Even though this property may not be counted toward eligibility, it may still be subject to recovery after your death.
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If you aren't familiar with Medicaid, it is a health care assistance program, run by both the state and federal government, that pays for medical services deemed medically necessary by a physician. Medicaid is considered a "need-based" program because there are limitations on the amount of financial resources a recipient is allowed to have in order to qualify for benefits. For example, to be eligible for Medicaid, an individual can only have assets valuing $2,000 or less.Your residence is generally excluded in determining the value of your property or resources. Nevertheless, it is still relatively easy to spend all your savings before Medicaid will start paying for necessary long-term care expenses. Medicaid planning is a useful strategy for preventing that from happening.
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