Medicaid is a state and federal program that may help an elder with the high cost of long-term nursing home or assisted living care. In Maryland, the program goes by the name Medical Assistance — the two program titles are used interchangeably.
An extremely complex set of laws and rules governs administration of Medicaid provisions relating to nursing home care for elders. The program has strict financial eligibility standards for a senior’s (and, if the senior is married, their spouse’s) income and assets.
Medicaid / Medical Assistance is not the same as Medicare. To learn about the differences, you may read our previous blog post on the Key Differences Between Medicare and Medicaid / Medical Assistance.
Often, achieving eligibility for Medicaid requires advance planning and restructuring assets or income — and that’s why Medicaid planning is essential for any elder anticipating the need for nursing home care in the future. Consulting with a qualified professional knowledgeable in Medicaid laws and rules is essential to planning properly for Medicaid eligibility.
In our elder law practice at The Law Office of Henry Nash in Rockville, Maryland, we help elders and their families navigate through the complex rules for receiving benefits through Medicaid / Medical Assistance. We alleviate the confusion and stress that can accompany the process and explore every opportunity for receiving benefits for you or your loved one.
To gain and preserve access to Medicaid nursing home benefits, an elder (and the elder’s spouse) must meet the strict income and asset eligibility requirements. Medicaid rules provide a number of permissible strategies for financial restructuring that may accomplish eligibility, even if it appears initially that an individual may not meet the eligibility criteria.
To take advantage of those strategies, you should talk with a Medicaid planning attorney as far in advance as possible before you actually need the benefits. You also should consult with a Medicaid planning lawyer before you make any changes in your financial situation or assets in anticipation of needing Medicaid coverage. Taking the wrong steps on your own can jeopardize your ability to receive benefits when you really need them.
Medicaid rules use a five-year “look-back” period in conducting the asset analysis for determining eligibility. If, within five years preceding an application for benefits, the applicant (or spouse, in some cases) transfers property without receiving full market value in return, the transfer may constitute violation of the look-back rule. Violation of the rule results in a period of ineligibility for benefits, based on the value of the transferred asset.
Detailed criteria apply to the look-back analysis. Before you give away any property or sell it at less than full value (for example, transferring your home to your children), thinking it may help you qualify for Medicaid, you should discuss your situation with a Medicaid planning attorney. Transferring the property without getting legal advice actually may defeat your goal entirely.
In addition, some of the strategies for accomplishing eligibility involve setting up a trust that protects your assets and helps you meet the asset requirements, which takes planning and time. One example is a Special Needs or Supplemental Needs Trust (SNT). You can read more about that type of trust in our blog article on the Role of an SNT in Medicaid Planning.
There are other ways to achieve eligibility as well. The specific steps that are right for you will depend entirely on your individual circumstances. The only way to get an accurate analysis of your situation is to consult with a Medicaid planning attorney.
Under Medicaid rules, planning for married couples is more complicated than it is for an elder without a spouse. For married seniors, if one or both spouses may require nursing home care at some point in the future, Medicaid planning is especially crucial.
Achieving eligibility for Medicaid benefits is not the only objective of Medicaid planning. Like any type of financial planning, a significant goal of nursing home and other long-term care planning is to maximize protection and preservation of assets, while taking full advantage of available benefits like Medicaid.
Medicaid planning is much like estate planning. The process anticipates future potential events, then puts the right legal structures in place to protect you if those events occur. In the case of elders, Medicaid planning and long-term care planning actually are an important part of estate planning.
Any type of planning is most successful if it is accomplished well in advance of the events that trigger the need for protection. It is especially critical to plan ahead for Medicaid because of the five-year look-back period on asset transfers. If you or your elder loved one may require nursing home care or other long-term care in the future, consulting with an experienced attorney who assists with Medicaid and estate planning is an extremely important step to take at the earliest possible time.
Attorney Henry Nash has extensive experience helping elders and their families work through the complex laws and concerns inherent in all types of elder law matters, including Medicaid planning and estate planning.
At The Law Office of Henry Nash, we work with clients in Rockville, throughout Montgomery County, and elsewhere in Maryland. We also assist out-of-state clients who have loved ones residing in the state. If you have any questions or concerns about any issues relating to elder law, we welcome you to call us at (301) 998-6111 or contact us through our online form.