Paying for long-term care has become a major concern for people of all ages, as nursing home care averages over $7,000 per month and can reach as high as $11,000 per month. Most people do not realize that Medicare and private health insurance do not cover long-term care costs. Medicare is designed to pay for doctors, prescriptions, and hospital care, but not long-term care. Medicaid is the largest payer of nursing home costs and it is the only public program designed to pay for long-term care. Medicaid planning for long-term care is complex due to federal Medicaid laws and state specific regulations and processes. The rules and regulations are often misunderstood and there is a lot of incorrect information circulated about Medicaid, which is why it is important to get advice from a qualified Medicaid planning attorney. If proper planning is in place, you might be able to significantly reduce the amount of assets spent on long-term care.

MEDICAID QUALIFICATIONS

For an applicant to qualify for long-term care Medicaid benefits, he or she must meet the following baseline requirements:

Categorical Requirement

  • an applicant must be 65 years of age, blind or disabled, and be a U.S. citizen or have immigration status.

Medical Need Requirement

  • an applicant must be assessed and meet an institutional level of care indicating it is medically necessary for the applicant to receive Medicaid benefits.

Income Limitation Requirement

  • The income limit to receive long-term care Medicaid benefits for a single person is $2,382 (as of 2021) per month. If an applicant receives more than $2,382 per month, then the applicant will not be considered income eligible for Medicaid benefits and must establish Qualified Income Trust (QIT) to become eligible.

Asset Limitation Requirement

  • If a single person or spouse is applying for long-term care Medicaid benefits, then the applicant cannot have more than $2,000 in assets. The non-applicant community spouse can keep the lesser of half of the combined marital assets or $130,380. If a married couple is applying for Medicaid benefits, then they cannot have more than $3,000 in assets. These limitations are subject to some exceptions, such as a primary residence.

MEDICAID SPEND-DOWN

A Medicaid spend-down is a term used to describe a solution when a Medicaid applicant’s assets exceed the Medicaid asset limit of $2,000. If a Medicaid applicant is over the Medicaid asset limit, then the applicant must spend down his or her assets to the limit. Medicaid either considers an asset to be a countable resource or an exempt resource. A countable resource is an asset owned by the applicant that Medicaid considers available to pay for care, and an exempt resource is an asset owned by the applicant that Medicaid does not consider available to pay for care. An applicant whose countable resources exceed the asset limit has two choices: dispose of assets or devise a Medicaid plan and take advantage of the Medicaid rules to protect assets for the future.

PROACTIVE MEDICAID ASSET PROTECTION PLANNING

The reality is that people will require some type of long-term care during their lifetime. The goal of proactive Medicaid asset protection planning is to protect assets in advance of needing long-term care and being in position to have the option to immediately qualify for government benefits to pay for care in the future. One effective way to protect assets is through a Medicaid Asset Protection Trust. If assets are in a Medicaid Asset Protection Trust for five years prior to needing to apply for Medicaid benefits, then the assets are protected and not subject to a Medicaid spend-down. Proactive planning using Medicaid’s rules and regulations can enable a family to protect up to 100% of their assets, thus providing more control and flexibility in the future.

EMERGENCY MEDICAID ASSET PROTECTION PLANNING

Emergency Medicaid planning occurs when a client is already in a long-term care setting or about to transition to one from home or a hospital. Often times a family finds out from a hospital discharge planner that their loved one will need to find a long-term care facility immediately, thus forcing the family to quickly make many crucial decisions. Once in a long-term care facility, the family soon finds out that Medicare only pays very little for a short amount of time before having to use their own assets to pay for the cost of care, which can exceed $100,000 per year. In an emergency scenario, we can help the client put a plan in place to protect a substantial portion of assets, prevent or stop a spend-down, and qualify for Medicaid benefits to pay for care.

Professional & Experienced Help is Available

If you would like to discuss proactive Medicaid planning for the future or emergency Medicaid planning, contact us today to schedule a consultation.  Call My Ohio Estates to further discuss.