Medicaid Planning: When to Start
Planning for Medicaid
Medicaid planning is a process used to acquire Medicaid that is used to pay for nursing home care. Medicaid for the majority of people is a necessity.
How Medicaid Planning Works
Medicaid planning works in two ways.
- Protect assets
- Pay for nursing care when the need arises
For Medicaid to be effective, you should plan earlier before the need of going to a nursing home. In this case, you will need a lawyer who will help you legally regarding the requirements and considerations you should make while planning for Medicaid.
When to Start Medicaid Planning
Planning for Medicaid should begin after you have accumulated the value of assets that should be protected. The main goal of Medicaid planning is to ensure that your assets are not counted as you determine if you qualify for Medicaid. Most people opt to transfer assets to trust. By this, they are sure that the Medicaid coverage is secure. In case the trust being transferred is the owner of the asset instead of an individual, then the assets are seized from being considered eligible for Medicaid.
Developing Medicaid Planning
The process of developing and implementing your Medicaid plan should not wait until you need a nursing home. Legally, there is a five-year rule that is meant to ensure people do not just issue away their assets for the sake of Medicaid coverage. After applying for the Medicaid benefits, a review of your transactions is made for the past five years. This does not mean disqualification, but it is important for a lawyer to review.
Disqualification from Medicaid Coverage
The disqualification period is basically based on two factors:
- The value of the assets transferred
- The average cost of a nursing home
The number of months that make you ineligible for Medicaid is determined by dividing the asset value by the average monthly nursing home cost.
It is important to start the process of Medicaid planning early. Failure to plan early exposes you to the danger of losing more assets than you would have lost if you planned earlier. Ensure that you have a plan in place immediately after acquiring assets that you want to protect. An elder law attorney will help you with the legal strategies regarding planning for Medicaid. Contact The Mattar Firm if you or your friend is in need of legal advice.