MEDICAID PLANNING | Long-Term Care Planning | Asset Protection | Skilled Nursing Home Care
Medicaid Planning Scenarios
Entry of parent into a nursing home following hospital stay
Two (2) spouses alive, admitting one (1) spouse to nursing home
Child living at home, caring for parent entering nursing home
Strategic gifting to children to maximize ineligibility period
Spousal annuities to replace lost income to spouse remaining at home
Pre-planning for hundreds of families each year
Medicaid/Crisis planning for families throughout Crawford County, Mercer County, Venango County, and Erie County
Medicaid Planning is a type of Long-Term Care Planning that occurs in one of two ways: either the person is about to enter a skilled nursing home (or already has), or the person is contemplating entry into a skilled nursing home in the future.
Often, planning when a person already has entered (or will soon enter) is referred to as "Crisis Planning", but there is no reason to think of it as a crisis. Rather, it is a transition that requires a family to develop goals for the transition and to be informed about the laws that affect their goals.
When a person is not entering a skilled nursing home for at least 6-12 months, the planning that takes place is frequently referred to as "Pre-Crisis Planning", although that is also a term that is somewhat misleading to families, since we are dealing with transitions (which may be difficult, but are not crises).
A typical skilled nursing home admission scenario will be handled differently based on whether the person entering the home is single or married. Medicaid is applicable to both, but there are various spousal protections in place that are considered when there is still a spouse at home.
For a single person, Medicaid eligibility is generally based on two factors: (1) Medical Eligibility and (2) Financial Eligibility. Medical Eligibility requires that the person require 24-hour skilled nursing home care, and is determined by a doctor. In other words, a fairly healthy person, though elderly, will not qualify for Medicaid. Financial eligibility is a bit more complex, because it requires an evaluation of the person's countable assets. For Medicaid purposes, certain assets are exempt from being counted, including the person's residence (if the person intends to return, or if the house was recently listed for sale), one automobile, burial reserves, and certain other assets, like the person's personal property. Most other assets are countable, including bank accounts (even if they are jointly owned), cash values of life insurance policies, and generally any other assets of value. Depending on the person's income, once the person's countable assets are below either $2,400 or $8,000 (depending on income), the person will qualify for Medicaid.
Lawyers can provide considerable value in these situations, since there are numerous ways to leverage the applicable gifting rules to a family's advantage. Also, care must be taken to avoid, if possible, Estate Recovery. (This is the program that recovers a Medicaid recipient's assets after death--even if an asset is exempt at the time of application, it may be recovered later.)
For a married person, Medicaid eligibility is still based on the above-described two factors, but the Financial Eligibility is more complex, because there are significant financial protections for the spouse. Upon admission to the nursing home, the couple must fill out a Resource Assessment form, which