Older adults often expect Medicare to help them cover basic retirement health care expenses. However, as their support needs increase due to advanced age or medical challenges, they may find themselves in need of Medicaid benefits.
Medicaid covers long-term care costs, including in-home health aides and nursing home expenses. Those thinking about their financial stability as they age and their legacy after they die may want to plan carefully for Medicaid eligibility to reduce delays when they apply and avoid consequences after their passing.
Qualifying for Medicaid can be difficult
Medicaid applicants are subject to strict limits on their countable assets and current income. Older adults may need to spend down their resources if they do not plan in advance to enhance their Medicaid eligibility.
Any large transfers or gifts in the five years before applying for Medicaid can trigger a penalty. Older adults may be ineligible for coverage until they pay for their own care out of pocket for a set number of months. Prior planning by taking on co-owners and transferring resources to a trust can limit the risk of a Medicaid lookback penalty that delays benefit eligibility.
Planning can also limit the consequences of Medicaid estate recovery efforts. Federal laws require that state Medicaid programs file reimbursement claims against the estates of long-term care Medicaid recipients. Only planning well in advance can help people preserve key resources for their loved ones and ensure they can still leave a legacy if they require Medicaid as they age.
Consulting with an elder law attorney about Medicaid planning can help people preparing for retirement or concerned about their progressing health challenges protect themselves and their loved ones. A Medicaid plan can expedite the Medicaid application process and protect resources after a Medicaid recipient dies.
