What is Medicaid?
Medicaid is a government funded program that pays for the care of those who need to either live in a nursing home or live in an environment that provides that higher level of supervision and assistance. To be eligible for Medicaid, you must meet certain income and resource requirements. Typically, your resources cannot exceed $2,000 in value. Further, your income should be less than the total cost of a nursing home (a nursing home that accepts Medicaid) and additional medical expenses.
Medicaid and the Five Year Look Back
Quite often, those who anticipate needing Medicaid assistance start gifting their assets, so they will meet the program requirements. This type of move tends to backfire because Medicaid has a five year look back period. To deter individuals from intentionally making themselves qualify for Medicaid, case workers will look at gifts made in the five years before the date of application. While there are exemptions, certain gifts will trigger a penalty period of ineligibility. A common example is when a parent transfers the deed of his/her home to her children. A gift like this will automatically trigger a Medicaid penalty.
Medicaid and Estate Planning
If you expect to eventually qualify for Medicaid, talk to your estate planning attorney about ways to avoid incurring a penalty and how that affects the rest of your estate planning goals. Estate planning attorneys are often well-versed on how to navigate through the complex world of Medicaid.
Disclaimer: The purpose of this post is to provide general information and a general understanding of the law, not to provide specific legal advice. By accessing this blog site you understand that there is no attorney-client relationship between you and Sekhon Law, PLLC. This post should not be used as a substitute for competent legal advice from a licensed professional attorney in your state.