Are You Too Bougie for Medicaid?

If you have read the news anytime in the past few years, you can easily get the impression that the only people who qualify for Medicaid are desperately poor. Even in blue states like New York, the number of people who are too poor to pay for healthcare and other necessities, but not poor enough to qualify for Medicaid has grown. Granted, people in states with even less of a social support apparatus have it even worse, but here in New York, costs have increased, while consumers’ income has not. This is an especially scary thought if you are approaching retirement age. In today’s economy, your retirement income will not pay for much, even if you now consider yourself safely within the middle class. Even though you would never qualify for Medicaid in your current, employed, able-bodied state, you might need Medicaid nursing home care benefits when you are older. The good news is that, if you need Medicaid, you can get it, but the bad news is that Medicaid will go to great lengths to repay itself from your estate. For help seeing Medicaid in a new light, and perhaps holding onto what little generational wealth you have, contact a Bronx estate planning lawyer.

Just Because You Own Your House, It Doesn’t Mean That You Will Never Need Medicaid

Medicaid only pays for outpatient care and hospital stays for the people in the most desperate financial circumstances, but some Medicaid nursing home care beneficiaries, by contrast, seem to have lived a charmed life. Nursing home care is prohibitively expensive, and if you don’t have long-term care insurance, it can quickly burn through all your savings. Once you run out of savings, the nursing home staff will help you apply for Medicaid, but the catch is that Medicaid will repay itself with your Social Security check, leaving you with only a meager Personal Needs Allowance. Your Social Security income will not be enough to reimburse Medicaid in full. Therefore, Medicaid will file a claim with your estate during probate, seeking repayment for the rest of what it paid for your nursing home care. Medicaid claims could mean that the personal representative of your estate will have to sell your house, so your heirs cannot inherit it. They are also a common reason for estates settling insolvent, where the heirs inherit nothing.

How to Prevent Medicaid From Wrecking Your Estate Plan

If you missed your chance to buy long-term care insurance, needing Medicaid nursing home benefits is a strong possibility. You should set up a trust sooner rather than later and transfer your house to it. Do this now, because Medicaid may still be able to claim the trust assets if you transferred them less than five years before you applied for Medicaid. This is the Medicaid five-year lookback rule.

Schedule a Confidential Consultation With a Bronx Estate Planning Attorney

An estate planning lawyer can help you make informed decisions about protecting your estate from Medicaid claims.  Contact Cavallo & Cavallo in the Bronx, New York to set up a consultation.

Source:

apnews.com/article/nursing-home-medicaid-personal-needs-allowance-poverty-2e0a2d90d7d63d4b476397a50a9cddff