Long-Term Care & Medicaid Planning
Make a plan for long-term care
Planning for long-term care as we age can feel like a confusing maze. There’s a lot to consider: how to pay for care, the level of care to plan for and how to protect the assets you’ve worked so hard for.
You have options
It’s our job to help families find ways to obtain the necessary services either through private service providers or through any of the multitude of government-subsidized benefit programs that may be available. We have the experience and expertise to help pass a family legacy onto the next generation while ensuring quality care.
A common resource used to pay for long-term care is Medicaid. With Medicaid, comes the valid concern of protecting your assets. After all, it’s hard to imagine a lien being placed on your home as reimbursement for Medicaid coverage instead of being left to the people you care about most. So how can you benefit from Medicaid coverage and protect your assets? That’s where prudent planning comes in.
Protecting your assets from Medicaid liens
Administered by each state, Medicaid helps pay for long-term care after an individual’s funds are exhausted. In the simplest terms, you are expected to use any savings and assets you have to pay for your care. Once those are gone, Medicaid may be applied for.
You’ve worked hard for your assets and the last thing you want is to be forced to spend-down your life savings for long-term care, making planning important.
Understanding Medicaid’s look-back period
When you apply for Medicaid in a nursing home, there is a “look-back” period. Assets you have gifted or transferred within five years of the date of application are subject to penalties. The good news is, there are options to preserve your home and legacy for your loved ones—even if you’re within the five-year look-back period. In many cases, we’re able to preserve your home without impacting your ability to get the care you need. For instance, you may be able to take advantage of exemptions to the look-back period. If your spouse, a disabled or blind child, a child under age 21, or a sibling with an equity interest in the house lives in the residence, the residence may be transferred without penalty. In other cases, we may be able to gift your home as part of broader gifting strategy when qualifying you for Medicaid.
Other options for property protection include:
- Deed Transfer/Retained Life Use – This allows you to change the ownership of your home to another person, while still preserving the right to use and live in the property rent-free and keep your current tax exemptions.
- Irrevocable Income-Only Trust – By transferring real property and/or other assets a specific kind of trust at least five years before nursing home Medicaid is needed, we are able to take the property and other assets “off the table” for Medicaid purposes. This option may help protect additional assets over and above the home.
Click here to read about how we helped Richard and his family build a plan to preserve their assets in anticipation of increasing care for Richard’s Alzheimer’s.