Many people make it through their entire working years without ever needing to rely on Medicaid to cover healthcare expenses, only to find that they must turn to Medicaid as a senior. If you are among them, you may mistakenly believe some of the myths and misconceptions about the program. To help clear those up, the Londonderry Medicaid planning attorneys at DeBruyckere Law debunk five of the most common Medicaid myths.
- I own a house so I will not qualify for Medicaid. This Medicaid myth has some basis in fact; however, it is frequently misunderstood. Most states exempt a primary residence from an applicant’s “countable resources” when determining eligibility. If the value of your countable resources is above the threshold (just $2,000 for an individual in most states) your application for Medicaid will be denied. To qualify, you will have to “spend-down” your excess assets. So, while your home is probably safe, you could lose other assets if you need Medicaid in the future and you failed to plan for that possibility.
- I have Medicare so I don’t need Medicaid. Once you reach retirement age you will automatically be enrolled in Medicare if you, or a spouse, paid into Medicare over the course of your working years. While Medicare will cover many of your basic healthcare expenses, it will not cover LTC expenses. For over half of all seniors currently in LTC, Medicaid is the only help they get with their LTC bill. You may never need LTC; however, if you do – or a spouse does – you will likely need Medicaid unless you can afford to pay for that care out of pocket.
- My spouse will suffer if I need Medicaid. Although it has been decades since the Medicaid Spousal Impoverishment Rules were enacted, this myth continues. Prior to changes in the federal Medicaid rules, the spouse that remained in the home (the “community spouse”) was frequently left destitute because of the “countable resources” and “spend-down” rules. The Spousal Impoverishment Rules, however, changed that. A community spouse is now entitled to retain half of a couple’s countable resources as well as all his/her own income and even some of the institutionalized spouse’s income if it is necessary to maintain a basic standard of living.
- I can just transfer my valuable assets to my children. Not all that long ago it was possible to transfer assets when you realized the need to qualify for Medicaid; however, Medicaid now uses a five-year “look-back” rule that prevents asset transfers in anticipation of the need to qualify for benefits. Your finances will be reviewed, and any transfers made for less than fair market value will likely cause Medicaid to impose a waiting period. Therefore it is important to incorporate Medicaid planning into your estate plan now, hopefully long before you actually need to rely on the benefits offered by Medicaid.
- Medicaid only covers nursing home care. You undoubtedly would prefer to put off the need to move into a long-term care facility. Options such as daily home health aides, community care, and assisted living are available. Moreover, many states have “waiver’ programs that make it possible for Medicaid recipients to take advantage of these options.
Contact Londonderry Medicaid Planning Attorneys
If you have additional questions or concerns, please contact the Londonderry Medicaid planning attorneys at DeBruyckere Law Offices by calling our New Hampshire office at (603) 894-4141 or our Massachusetts office (978) 969-0331 to learn more or visit our website at http://dadlawoffices.com .
The Medicaid Estate Recovery Program (MERP) allows the state to file a claim against your estate after your death to seek reimbursement for expenses paid on your behalf while you were alive. In some cases, your house could be at risk after you are gone.
If your countable resources exceed the limit, you will need to “spend-down” your assets until the value of those assets falls below the program limit.
The earlier, the better. Because of the Medicaid look-back rule it is always best to have Medicaid planning in place because you never know when you will need to qualify.