Cape Coral Elder Law Lawyer Explores Medicaid Penalties
Medicaid has many rules when it comes to qualifying for nursing home coverage. An elder law professional can help to explain the different guidelines Medicaid has created that determine eligibility for nursing home care. If you have been named in a guardianship arrangement for an elderly loved one, then you need to become familiar with these rules and check to see if your loved one qualifies for coverage. But there is also a Medicaid penalty called the “look-back” penalty that can have a serious financial effect on your family.
What Is The Look-Back Penalty?
In short, the look-back penalty is applied to any asset that is transferred into or out of the account of an elderly person five years prior to submitting an application for Medicaid financial assistance. Medicaid considers any assets that were available five years prior to submitting an application as being eligible to help pay for nursing home care.
Is It A Financial Penalty?
The look-back penalty is delivered in increments of months and is not a financial penalty. If Medicaid determines that you have given away or received assets that could help pay for nursing home care, then you will have to wait before your application will be accepted.
For example, as of 2018 the average monthly cost for assisted living in Cape Coral is $3,228.00. Four years ago, your son needed help getting out of a financial situation so you sent him a check for $25,000.00. Since the check was sent within the look-back period of five years, it is subject to the look-back penalty. In Cape Coral, you can purchase eight months worth of assisted living care for $25,000.00. This means that you would have to wait eight months before your Medicaid would go into effect.
What Happens During The Look-Back Penalty Period?
In our above example, the family of the elderly relative would have to pay for the first eight months of assisted living services out of pocket. Medicaid would then take effect in the ninth month. If you choose an assisted living facility that is more expensive than $3,228.00 per month, then the family will have to pay whatever the full monthly charge would be.
What Can I Do?
In these situations, one of the most common solutions people choose is to simply wait to apply for Medicaid after the look-back period is over. This can be difficult in cases where the elderly relative needs to be placed into a facility immediately. But sometimes waiting a month or two could save a family a lot of money.
A better solution is to contact one of our elder law lawyers and get help with applying for Medicaid benefits. Our professionals are well-versed in the look-back penalty and can help your family to get the information you need to make this important decision.