There may come a time in your life when your health is declining and you need to plan ahead for future care needs. You may require in-home care, an assisted living facility, or even a nursing home, which can be a huge financial burden on you and your loved ones. Most people end up paying for nursing home care out of pocket in response to an unanticipated event and, after depleting almost all of their resources, qualify for Medicaid to pick up the rest of the cost, but it doesn't have to be this way. The best time to prepare for the possibility of such events is when you are still healthy. Through Medicaid planning, you are able to pay for your long-term care and protect your assets for your loved ones.
Medicaid provides medical assistance to low-income individuals and is the largest payer of nursing home bills in America. It is a joint federal-state program that requires your assets and monthly income to fall below certain levels to qualify. Recently, restrictions on Medicaid planning have been significantly tightened and can make Medicaid planning complicated. Our experienced elder law attorneys can help you create different strategies to protect your assets and income.
Exchanging your countable assets for exempt assets can be a solution to sheltering your assets for your loved ones. Countable assets are those that are not exempt by state law. Exempt assets can include your home, burial insurance, or an automobile. Instead of draining your savings on care costs, you can pay off your mortgage or purchase a car in order to rearrange your finances so that your assets are made inaccessible to the state.
If you are married, you can purchase an income annuity in the name of your healthy spouse. A couple's assets are usually grouped together when applying for Medicaid. The community spouse (healthy spouse) may use countable assets to purchase an immediate annuity to provide for himself or herself. By purchasing this annuity, the institutionalized spouse can qualify for Medicaid more easily since assets will not be grouped together. Converting countable assets this way allows each spouse to keep individual incomes.
Also, instead of liquidating your assets to finance your long-term care, you may create an irrevocable trust. These trusts cannot be altered or terminated. If you name a proper beneficiary, property and principal placed into the trust will be excluded from consideration for Medicaid purposes. However, these trusts must be in place for a specific amount of time for this strategy to be effective.
These are only a few options for you and your loved ones to protect your assets. Medicaid planning is complicated and involves many risks that should be discussed with an experienced elder law attorney who is aware of the latest regulations and restrictions. At Baxter & Borowicz, we want to help you plan for your future. Call one of our qualified attorneys at 614-504-8845 for a consultation today.