According to the U.S. Department of Health and Human Services, “Someone turning age 65 today has almost a 70 percent chance of needing some type of long-term care services and supports in their remaining years.”
The Medicaid program, although challenging to navigate, can provide some relief for seniors and their families when in need of long-term care. Unlike Medicare (which does not cover long-term care), Medicaid is a means-tested program. In other words, you can only possess a small amount of money or property, have a low income, or both qualify. Seniors often wish to preserve their money out of habit or with the intention of passing it on to their families, but Medicaid eligibility requirements largely prohibit both these things.
Whether you have just started to plan for future long-term care, or you are just now thinking about it, avoid these costly Medicaid mistakes.
5 Costly Medicaid Mistakes to Avoid:
Failing to Plan
Most people do not consider the possible need for long term care at a time when they are healthy and young. However, pre-planning is the surest way to avoid the possibility of losing a lifetime of savings to the costs of long-term care.
To qualify for Medicaid, you must meet the eligibility requirements at the time of your application. Many people incorrectly believe that they must protect assets before the look back period, but this is incorrect. Medicaid has a five year “look-back period” which often comes as a surprise. Having a plan in place now ensure you will meet all requirements during the look-back period and be eligible.
$45,000: the average annual cost for a senior to be in an assisted living facility. Depending on your family’s priorities, how your assets are held and how much is needed to preserve, a qualified Medicaid Planning Attorney can help you to qualify for government benefits while protecting your estate.
Not Knowing All Your Options
Although it is preferable to plan ahead while care physically and mentally healthy, it is never too late to prepare. 1/3 senior citizens will enter a nursing home this year. While some pre-planning can occur five years before needing nursing home Medicaid, there are still many options even after you or a loved one has moved into a nursing home. Do not wait until your assets are completely depleted before seeking help.
Transferring Assets To Qualify For Medicaid
Many people wrongfully assume that they can gift their assets to family members to qualify for Medicaid without penalty. However, Medicaid often classifies these gifts as uncompensated transfers. This can result in difficult tax problems and can create Medicaid ineligibility for an extended period of time. Proper planning can avoid being penalized.
Applying For Medicaid Too Early or Late
The timing of a Medicaid application is crucial. If your intentions are for your life-savings to be used for your long-term care needs, you can spend down such savings on your nursing home costs and become impoverished. You will be eligible as soon as your assets are depleted. The average cost to stay in a US nursing home for one year: $76,680 However, if your intentions are for your life-savings to be used to protect your stay at home spouse, yourself or other family members, proper planning must take place and transfers or spend downs must be done before an application can be filed.
Not Getting Expert Help
Qualifying for Medicaid is tricky, and a competent Elder Law professional should be consulted before making applying. Considering the monthly cost care ranges from $5,000 to the $10,000+ each month and there is a lot at stake.
Contact a Medicaid Lawyer At Evergreen Elder Law Today
At Evergreen Elder Law, we provide a holistic and team-centered approach to estate planning and asset protection to help Eastern Washington & Northern Idaho seniors secure their financial future. Our goal is to help you put a flexible, thoughtful plan in place that protects as much of your hard-earned assets as possible. Because one of the hardest parts of long-term care planning is just getting started, we would encourage you to schedule a free consultation to learn all of your options and to avoid making common Medicaid mistakes. Contact us today.