What is Medicaid Planning?

Medicaid planning is the process of planning ahead for the long-term care of elderly loved ones. It also includes crisis or immediate planning, but it is always best to avoid waiting until the last moment as that often leaves fewer options.  The process is intended to evaluate and plan for eligibility for Medicaid coverage either in a care facility or for at-home care. Eligibility considers a multitude of factors and has strict rules that must be followed to qualify for coverage.

*This blog is for educational purposes only and should not be considered legal advice. The use of the Paths Law Firm website does not constitute a client-lawyer relationship.

Factors affecting qualification for acceptance into a Medicaid program commonly include:

– Income
– Assets, including life insurance
– Marital Status
– Veteran’s Benefits
– Any other benefits that an applicant may be receiving.

This planning process can be relatively simple, but is often complicated, but can worth any trouble for the care and financial benefits. Much of the complexity in Medicaid planning is when an applicant’s income and/or assets meet or exceed the initial eligibility requirement limits.

How Does The Medicaid Planning Process Work?

There are several different techniques that are included in Medicaid planning to achieve these goals.  The first goal of Medicaid planning, with the assistance of an Elder Law Attorney, is to ensure eligibility. The second goal is to save or protect as many assets as possible from being affected by the application process. One may also say, a third goal is to simplify or ease the application and acceptance process for the family. These goals go together.

– Asset Transfer Management
– Creation of Trusts, if needed
– The Conversion of Countable Assets into Exempt Assets

These techniques are used to ensure that the family and/or healthy spouse of the applicant will have enough income while protecting their existing assets.

For example, in some states and for some Medicaid programs, homes and assets are not included in the asset calculation. However, a second property or vehicle that is used for recreational purposes will be considered countable assets. There are actually some strict options the law allows where a second property can be transferred to certain types of trusts or to another person. This can be complicated to complete without assistance, but the elder law attorney can assist in meeting eligibility criteria as well as protecting the asset.

It is not possible to simply transfer all assets upon application in order to qualify for a Medicaid program. The history of the applicant, spouse and family will be analyzed in order to confirm asset transfers or trusts that were entered into with explicit means to be eligible for a Medicaid program. The law allows Medicaid to “look-back” five years for many programs and access qualification based on activity over that time.

Why Choose Elder Law Attorneys for Medicaid Planning?

As mentioned above, Medicaid planning is a complicated process with many factors that need to be considered. Each case must be evaluated based on its individual merits and circumstances. The specific Medicaid program and the rules that apply to that program must also be considered. Not to mention that the rules vary from state to state. Attorneys who focus on this area of the law should be well versed in all the intricacies and provide invaluable assistance in the process.

An Elder Law Attorney will apply their expertise to the entire Medicaid planning process. This includes assessing each individual case, to completing and submitting the necessary documentation. Ensuring that this documentation is completed correctly, and its entirety can speed up the approval process. Not only is Medicaid planning complicated, but it is also a lengthy process.  An Elder Law attorney not only has expert knowledge of the eligibility criteria but also the laws related to Medicaid planning in a specific state. They know how to ensure asset and income protection while helping the applicant receive the best care possible with the assistance of a Medicaid program.

While there are other types of Medicaid planners that can assist with the application process, they do not have the same expertise as an Elder Law attorney. Often, they cannot employ the same techniques as an attorney to provide the best outcome for all parties involved. It is well-advised not to confuse some familiarity with the legal education, training, and experience of a lawyer who has researched, counseled and implemented hundreds, if not thousands, of plans before yours.

How Do I Avoid Mistakes and Penalties with Medicaid Planning?

Medicaid can penalize certain actions that are instituted to meet eligibility requirements or to protect income and assets. An Elder Law attorney will work with you to protect your assets and to avoid these penalties.

– The look-back period is where an applicant’s past financial and other transactions are checked in order to ensure that measures are not being taken to hide assets, income or other benefits. While gifting can be used in planning, it is important to follow the rules when doing so.

– Planning is critical to putting measures in place to protect assets, income, and other benefits long before the application is made. Starting early with Medicaid planning may also reduce the length of the application process.

– Ideally, Medicaid planning should form part of a long-term estate plan. Discussing an estate plan with an attorney is critical to protecting wealth and ensuring financial security through retirement.

What Does Medicaid Planning with An Elder Law Attorney Cost?

The cost of Medicaid planning with an Elder Law attorney can range from a few hundred dollars to many thousands of dollars. The cost associated depends on the complexity of the case, and the services provided by the Elder Law Attorney. It is only a benefit to use an Elder Law Attorney though when at least one of the goals, if not all three, can be met and worth the fee. It is important to note that these charges should be offset by the value that is received from the services provided. The long-term protection of assets, as well as income for a family or spouse, can have far-reaching consequences.

At Paths Elder Law, we highly recommend planning for Medicaid in advance before you have a need for nursing care. Advance planning is the best option in protecting your assets and your family to help reduce your out of pocket costs for nursing care. We focus on helping families by providing legal options that meet their long-term needs. If you or your loved ones need help with Medicaid planning, schedule a consultation with Paths Law Firm today.