Medicaid Planning

You Must Plan in Advance for Your Spouse’s Future Care

September 27, 2021Filed Under: Medicaid Planning

At some point in your life, there may come a time when you realize you can no longer take care of your spouse at home. At this emotionally difficult time, the last thing you need is the stress of not knowing where to find the money to pay for the steep costs of institutional care.

Advance planning is a must. As as soon as you can – ideally, at least five years before serious health problems arise – take advantage of many elder attorneys’ willingness to talk with you for free, or for a modest initial consultation charge.

We are here to help you navigate the complexities of the Medicaid program. This is a governmental fund available to meet the staggering expense of institutional care, but the ins and outs of the qualification rules are complicated and mistakes can be costly. Here’s a thumbnail to help you grasp what your attorney will be telling you.

“Resources” and “Income”: The Difference

Medicaid assistance is available only to those who own very little. The Medicaid rules determine what “owning very little” actually means. A person can only own around $2,000.00 of what Medicaid calls “resources.”

Resources include cash in the bank, CDs, the cash value of insurance policies, investments, and the like. Income includes regular paychecks, Social Security, or payments received for child support. Both income and resources are potentially “counted” by Medicaid as “available.” To qualify for assistance, available income and resources must be carefully spent or transferred away.

Exempt Resources

Some resources are not counted or, in other words, are exempt. This means the Medicaid rules exclude them from adding up to the $2,000.00 limit. These resources are sheltered from Medicaid’s requirement that the applicant must spend down almost everything before assistance will be available.

A married couple’s residence, one motor vehicle, household goods and furnishings, medical equipment, jewelry, and other items are exempt. This means that an ill spouse can still qualify for Medicaid assistance even if the couple owns those resources. There’s no need to give them away or sell them to qualify.

The distinction between “exempt” and “non-exempt” assets can be tricky, though, and should first be assessed by a qualified elder-law attorney before any action is taken.

What the Well Spouse Can Keep

The Medicaid rules permit a spouse who remains at home to keep a portion of the couple’s resources. This is known as the “community spouse resource allowance” (CSRA). Of course, you’d like to see the well spouse keep as much as possible within the CSRA limits. Planning can arrange the distribution of resources to make that happen.

Here is where the difference matters between “resources” and “income.” Medicaid distinguishes between the well spouse’s income and the couple’s resources. Resources over the CSRA limit must be spent down or carefully transferred. As to income, the well spouse can keep it up to a certain level, so he or she will have enough money to live on. The Medicaid rules call this the “monthly maintenance needs allowance” (MMNA).

For example, if the well spouse gets Social Security benefits of only $500.00 a month, but her allowed MMNA is as high as $2,000.00, it makes sense to convert some of the couple’s resources into raising her income up to the MMNA limit. This is not a simple matter, though, and should be done only on the advice of a qualified elder-law attorney.

Planning for Medicaid eligibility can be complicated. Please consult an elder-law attorney as soon as possible. The sooner you plan, the more strategies are available to protect your resources. An initial consultation with a qualified elder-law attorney, for free or for a modest amount, could save you many thousands of dollars.

Don’t delay. If you’d like to discuss your particular situation, please don’t hesitate to reach out. Please contact our Cincinnati office by calling us at 513-771-2444 with any questions.

Medicaid’s Gift Giving Policies

July 26, 2021Filed Under: Medicaid Planning

Your loved one should not be giving gifts if there is a possibility that a loved one might need Medicaid assistance in the foreseeable future. This can be sad if that person gets joy out of generosity. But gifts in that situation can turn out to be very, very expensive.

Medicaid is the government program that covers the huge expense of long-term care, for those who are not able to pay for it out of their own pocket. But to be eligible, Medicaid applicants must be pretty much broke. They are permitted to own no more than around $2,000.00.

On the filing of a Medicaid application, caseworkers will meticulously investigate the applicant’s financial history. They are looking to see whether an applicant has given away money or assets over a period of years before the Medicaid application is filed. That period of years is known as the “look-back” period. In all states except California, that period for nursing-home care is five years under the current rules. In California the period is 2.5 years.

Depending on the size and number of gifts given away during the “look-back” period, the penalty imposed as a result could be substantial.

Many think that there would be no penalty for gifts of up to around $15,000 annually. That misunderstanding confuses tax law with Medicaid law (and it also is not quite accurate under tax law, but that’s another subject). In the Medicaid context, gifts of any amount that are given during the look-back period can be penalized.

There are a number of options to protect assets and still qualify for Medicaid. For instance, exceptions include gifts to spouses and siblings under certain circumstances, disabled children, and children who are caregivers and who live at home with the elder for a span of time. But overall, gifts and Medicaid do not go together.

The Medicaid rules are complicated and the consequences for mistakes like gift-giving can be very costly. This is why it’s best to consult attorneys like us, who are especially qualified by our experience and expertise in Medicaid law. If you have questions or would like to discuss your personal situation, please don’t hesitate to contact us at 513-771-2444.

Will Medicaid Take My Home?

May 3, 2021Filed Under: Medicaid Planning

It’s a part of the American Dream to be able to buy your own home. People work hard all their lives to own a home, and it is often their most valuable and significant possession. So, when health begins to fail and the need for long-term care arises, we often get this fear-filled question from our clients: will they take away my home?

The enormous and on-going costs of nursing-home care are astronomical, on average around $8,500.00 a month depending on location. The joint federal and state Medicaid program foots the bill for one in four of around 75 million recipients in this country. This is an enormous drain on government funds. To recoup some of those costs, then, the Medicaid rules permit states to take the value of a recipient’s home in some cases, to reimburse the program for funds it has expended.

Yet, because a home is such an essential family possession, the rules treat a primary residence as exempt – that is, its value is not counted as available to pay for nursing-home care from the home-owner’s pocket, before Medicaid kicks in. The home is protected, to a certain extent, for the benefit of Medicaid recipients and their close relatives.

That protection can be lost, however. The value of the house can be counted against a Medicaid applicant, and benefits denied or curtailed, when:

* A home-owner has no living spouse or dependents, and

* The owner moves into a facility permanently, with no intent to return home, or

* The owner dies.

In other words, as long as the owner expresses the intent to return home, and the owner’s spouse or disabled or blind child live in the home, the home will not be counted against the owner for Medicaid-eligibility purposes.

Once the owner passes, however the state may place a lien on the home, to secure reimbursement of the value of the Medicaid services the owner received. This lien makes it impossible to sell the home or refinance a mortgage, without first paying the state what it may be owed.

As elder law attorneys we know a number of ways to protect homes from this kind of attachment. If you come to us at least five years before you anticipate needing nursing-home care, we can preserve your home or its value such that Medicaid will not count it, or lien against it, at all.

Or, if a child moves into the home and cares for an ailing parent for two years, permitting the parent to stay home and out of a nursing home, the house can then be given as a gift to that child without any Medicaid penalty or disqualification. Ordinarily, Medicaid heavily penalizes giving away property, but this is one exception.

There are other strategies available. The home can be given to a disabled child without penalty or disqualification. Or, you might keep the right to live in the house for your lifetime and deed the remainder interest to others, who will then own the house after you pass. However, each strategy comes with risks that must be fully explored before determining the correct one.

An overall plan that is tailored to suit each individual, and to meet as many contingencies as possible, requires juggling a number of puzzle-pieces. There is no one cookie-cutter solution. The key is to plan before you or your spouse may need nursing-home care.

As one piece in the overall picture of a balanced estate plan, we can help you save your home. We welcome the opportunity to work with you. If you have questions or would like to discuss your personal situation, please don’t hesitate to contact us at 513-771-2444.

How to Prepare for an Aging Parent’s Care

April 19, 2021Filed Under: Elder Law, Medicaid Planning, Senior Health and Wellness

One truism of providing care for an aging parent one is preparation is crucial to success. Whether you need basic information about eldercare resources and services, are looking for a local agency to provide those services, or have worries about legal documents or how to finance your parents’ care needs now or in the future, the time to begin planning is today.

The American Public Broadcasting Service (PBS) and television program distributor provides an online handbook, Caring for Your Parents, that offers good preparedness strategies. These planning strategies, links, and tools are also transferable for spousal care, other elderly relatives, or caring for a loved one who is chronically or critically ill with significant ongoing needs. The PBS handbook, designed by WGBH Educational Foundation and the MIT Workplace Center, addresses a wide variety of situations and is even appropriate when considering your own needs as you age.

In terms of an aging parent, it all begins with an open and honest conversation. You might be fortunate and know your parents are well prepared for their future, but most Americans will face situations where loved ones will require additional help and resources. If your parents have a solid aging plan with proper legal documents and financial backing, know that you can access that paperwork and account information.

If there is no plan in place, talk with your parents about future changes with appropriate family members. Take small steps to prevent overwhelming your parents, listen carefully, and be prepared for some denial. Discuss living at-home safety, bringing in outside services and caregivers into their home. Also, broach assisted living or nursing homes and if your parents’ have a valid will and health care proxy. Define their healthcare and living needs for the present and the future.

When locating services remember all eldercare is ultimately local, and services vary widely among states and regions. If you care for your elder parent but do not live nearby, look for resources in the state and neighborhood where your loved one lives. Be persistent; no one resource has all the answers. You may receive advice that something cannot happen when in fact, it can. Request an “Information and Referral” (I&R) specialist. These specialists have the proper training to answer a wide range of questions and connect you to services.

Much of your search will be on the internet. Your search can be overwhelming as there is so much information about eldercare, so be sure to use trustable sites for data. The PBS Caring for Your Parents Handbook’s links can specifically help navigate eldercare services and information complexities, whether the needs be moderate or significant.

Aside from identifying and using eldercare services, the Handbook contains information about finances, legal issues, insurance, home care, housing and transportation, health care, activities, and strategies for caregiver wellness. You can cross-reference data you uncover using the AARP online forums, where people share experiences, ask and answer questions, and learn from each other. Or use the AARP search tool entering phrases like “caring for your aging parent” for articles, books, and guides that you can compare with the PBS Handbook.

When establishing a care plan for your aging parents, realize that good intentions can quickly derail without legal documents in place permitting you to make decisions on their behalf. The quality of life and end-of-life care your parents receive is inextricably linked to proper legal documentation. When making plans and acquiring eldercare services, be certain to speak with an elder law attorney who can provide an overview of the aging process from a legal perspective and identify your parents’ specific needs. Health care proxies and living wills will enable you to make decisions based on your parents’ beliefs, values, and wishes when they are no longer able to decide for themselves.

As elder law attorneys, we consult with families on both care and legal needs of family members as the two are closely related and should be considered together. If you would like to discuss your particular needs, we would be honored to speak with you. Please don’t hesitate to contact us at 513-771-2444.

You Must Plan in Advance for Your Spouse’s Future Care

Medicaid’s Gift Giving Policies

Will Medicaid Take My Home?

How to Prepare for an Aging Parent’s Care

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