The Wall Street Journal indicates a person who has reached the age of 65 will have a 40 percent chance of requiring nursing home care. Approximately 70 percent of people 65 and over need care for some duration in a nursing home, and a person who has turned 65 has a 40 percent chance of needing nursing home care for no less than five years. If you want to make certain you can afford any care you require when and if you need to move into a nursing home, you should work with The Law Office of Michael Robinson, P.C. today to make a Medicaid plan.
Working with an experienced attorney is important because far too many people attempt to make a Medicaid plan and make costly mistakes. The Law Office of Michael Robinson, P.C. will help you to avoid problems with your Medicaid plan, including these common errors that far too many people make as they plan ahead for the future.
Assuming You Don’t Need a Medicaid Plan
Far too many seniors think Medicare will cover them and that they don’t need to worry about Medicaid since they’ll already have coverage. The problem is that Medicare won’t cover things like custodial care. Custodial care is defined to include basic daily tasks that most people handle on their own. Custodial care includes routine life activities like getting up and out of bed or dressing yourself and it also includes activities related to your health that you don’t need skilled professionals for, like putting eye drops in. Most people who must move to a nursing home or who must get long term care at home need custodial care – and if you don’t have a Medicaid plan in place and the care is not covered by Medicare or any private insurers, you could be looking at substantial costs.
Waiting too Long to Make a Medicaid Plan
Medicaid has a “five-year look back rule,” which essentially means an assessment is made of your transactions during the prior five years, measured from the time you apply for benefits. If you sold valuable assets for way less than market value to a close friend or if you gave money and property away, you will be temporarily disqualified from getting Medicaid. This is to make sure you don’t just give assets away right away when you get sick.
Using the Wrong Legal Tools to Make a Medicaid Plan
If you are hoping to make a Medicaid plan, you need to explore options for structuring the ownership of assets and property so it does not count as a resource for determining eligibility for Medicaid. Owning too many assets can disqualify you from getting benefits until you have spent your wealth and impoverished yourself, so you’ll need to be smart about protecting money and property. While many people think a living trust will give them the asset protection they need, transferring assets to a living trust will not result in those assets not counting for Medicaid eligibility.
Giving Away Assets to Try to Qualify for Medicaid
If you give away assets, you can cause yourself to become temporarily disqualified from receiving Medicaid. The period of temporary disqualification will last for the number of months determined by dividing the value of transferred assets by the average monthly cost of a nursing home in your local area. If you gave away $10,000, for example, and the average monthly cost of a nursing home where you live would be $5,000 monthly, then you would be disqualified from getting Medicaid for a two month period ($10,000 divided by $5,000).
As you can see, there are pitfalls everywhere. Understanding the most common mistakes can help you avoid trouble in the future.