Question: Will the government take all my money and my home before I can qualify for Medical Assistance (Medicaid)?
Answer: Medicaid eligibility is a concern for many people who fear the increasing costs of nursing home care. Medicaid is the government program which is designed to pay the cost of nursing home care for people who do not have the means to afford such care.
One common misperception is that the government will take your home and money before you can qualify for Medicaid. The reality is that the government will not take your assets, but in order for the government to pay for your care, the law requires that you spend down your own resources. However, certain assets are not necessarily subject to a spend down. For example, a personal residence is an exempt resource which does not need to be sold so long as the Medicaid applicant has a spouse that still lives in the home. Other exceptions apply as well. Even if there is no spouse who resides in the home, the rules permit some leeway before requiring the sale to take place. You are permitted to purchase or upgrade assets which are exempt for Medicaid purposes without jeopardizing eligibility for Medicaid. For example, you could make improvements to your home, buy a car and purchase pre-paid funeral contracts. As a final thought, a strategy for protecting family assets is to make immediate gifts to children. When you give away assets, the gift will result in a penalty period during which you cannot qualify for Medicaid even though you might have been eligible had you not made the gift. The timing of these gifts is often a tricky part of the planning process so it is advisable to consult with an attorney.
If you have any questions or would like more information please contact Steve Shane at: email@example.com | 301.575.0313.
ABOUT STEVE SHANE
Steve Shane provides strategic counseling to clients in need of estate administration, charitable giving and business continuity planning while minimizing estate, gift, and generation-skipping transfer tax exposure. He offers legal guidance to clients on asset protection and the proper disposition of assets in accordance with the client’s objectives, while employing tax planning techniques such as the use of irrevocable trusts, life insurance planning, lifetime gifts and charitable trust. He is also experienced with drafting documents for business planning, the incorporation and application for exemption for Private Foundations and the administration of decedents’ estates.