There are certain misunderstandings regarding Medicaid benefits, planning, and qualification. Below are some highlights of the misunderstandings that are associated with Medicaid benefits for long-term care.
Medicaid benefits provide varying levels of long term care at almost no cost to those in need. In fact, the majority of patients in nursing homes are having their bills paid by Medicaid. Many people believe that person needs to be impoverished to receive Medicaid benefits, but this is not always the case. Proper planning and implementation of a Medicaid strategy can protect and preserve any family’s nest egg if you need long term care.
Applying for Medicaid Without Consulting an Attorney
It is not advisable to apply to Medicaid to determine if you are eligible because, as soon as the application for Medicaid is submitted, you may lose any chance you might have had to protect your assets. An experienced attorney will help you determine your eligibility before you apply and assist you with implementing strategies that protect much of your nest egg.
It’s Never Too Early or Late to Plan
It is never too early or late to begin your Medicaid Planning strategy. It may even be possible to implement a Medicaid Planning Strategy after a person is already in a nursing home. An experienced attorney may be able to help identify and implement planning strategies that could preserve a significant portion of your nest egg. However, the sooner you start planning, the greater the benefit is likely to be. Waiting until you need long term care will likely result in you being able to preserve less of your nest egg.
If a person hides assets or cash to qualify for Medicaid, then it is considered as fraud and can result in legal action or prosecution. A qualified attorney uses strategies for asset protection that are ethical, legally sanctioned, and honest. Hiding assets can result in not just a denial of benefits but also criminal penalties.
Protection of a Spouses Assets
The assets of a Medicaid recipient’s spouse are provided with some level of protection. To be eligible for these protections, the spouse need not be impoverished, lose their home, or their life savings. Spousal asset protection can be complicated and an attorney can help by suggesting various strategies to protect one spouse's assets while allowing the other spouse to still qualify for Medicaid.
Assistance from Medicaid Employees
Medicaid employees will only provide limited help directly related to helping you apply for Medicaid. They are specifically instructed to not provide applicants with strategies for asset protection.
Medicaid planning strategies can be complicated and difficult to implement so many people do not take advantage of the strategies available including conversion, spend-down, exemption, and transfer-funding. With help from professionals who can provide you with advice on implementing a Medicaid planning strategy, you will ensure that you properly transfer funds, pay off mortgages, make home repairs, and pre-pay expenses in a way that benefits your overall Medicaid planning strategy.
Experienced Medicaid Attorneys
Consulting a qualified attorney with a specialization in Medicaid Planning and elder law is important. Failing to consult with an attorney who specializes in this area cab lead to a failed strategy and difficult situation. Medicaid laws are very intricate and if an attorney does not understand these intricacies, the attorney will not be able to provide you with effective Medicaid Planning strategies. Wrong advice can lead to trouble.
Medicaid Trusts by State
There are different Medicaid planning rules in different states. For example, Florida law offers unique opportunities that are not available anywhere else. However, rules change over time, so it is necessary to work with an experienced attorney so you that you will receive the latest information.
No Professional Guidance
To get the maximum benefits from Medicaid planning, it is important to get professional help. This is essential because no two situations are the same, and if strategies are not implemented properly, it may cause benefit denial. Therefore, it is important to seek professional help from qualified and experienced attorneys.
A living trust cannot protect your assets from the cost a nursing home because a living trust is fully revocable. Than means that the trust owner can take back the trust principal at any point. Federal and state law views the trust principal as a resource to pay for care at the nursing home.
Proper Estate Planning
It is necessary to get professional help before making gifts in an effort to reduce your assets so that you will qualify for Medicaid. Giving larger gifts may have significant tax and Medicaid eligibility consequences. Under federal and state law, assets transfers made within five years of applying for Medicaid will result in a delay in receiving Medicaid benefits. The more money that is transferred, the higher the penalty and the longer the waiting period. Therefore, it is important to be careful and seek professional help before making an asset transfers.
Issues with Financial Transactions
It is important to coordinate and consider the taxes, penalties, and estate planning issues when making transfers of any type before and during the implementation of a Medicaid planning strategy. A qualified and experienced attorney will be able to guide you on how to engage in beneficial financial transactions and avoid those that can be problematic.