Qualifying and enrolling in Medicaid
Unlocking the support Medicaid offers can be a lifeline for managing and paying for dementia care. From comprehensive coverage for long-term care and medications to specialized services and caregiver support, Medicaid can help safeguard against financial strain. But navigating eligibility criteria demands strategic planning and expert guidance - every state has different requirements. People many times talk about the need to reach out to an attorney to prepare for future medical decision making, however an eldercare attorney can also be very helpful for financial planning, especially if you believe your loved one with dementia may be able to qualify for Medicaid. Here’s a general overview of the considerations involved:
Understand Medicaid Eligibility Requirements
Medicaid is a joint federal-state program that provides health insurance for low-income individuals and families. In California (for example), the program is called Medi-Cal. To qualify for Medi-Cal, individuals must meet specific income and asset limits. Generally, you must have limited income and resources to qualify. Looking into the requirements for qualification in your state as early as possible so you can put a plan in place.
Asset Limits
California has a relatively high asset limit for Medi-Cal eligibility, meaning you can retain a significant portion of your assets while still qualifying for coverage. However, there are certain assets that are counted towards the limit, while others are exempt.
Exempt Assets
Primary residence (including a reasonable amount of land)
Household belongings and personal effects
One vehicle
Burial plot or cremation niche
Prepaid funeral expenses up to $1,500
Life insurance policies with a face value of $2,500 or less
Non-Exempt Assets
Savings accounts
Investment accounts
Real estate other than your primary residence
Valuable personal property (e.g., jewelry, artwork)
Planning Strategies
Gifting: While there are restrictions on gifting to qualify for Medi-Cal, an attorney can advise you on strategies for gifting assets that won't jeopardize eligibility.
Annuities: Annuity contracts can be used to protect assets while still providing an income stream.
Life Estates: A life estate allows you to transfer ownership of a property to another person while retaining the right to live in it for the rest of your life.
Irrevocable Trusts: Irrevocable trusts can be used to protect assets from creditors and Medicaid claims.
Seek Professional Guidance
Consulting with an experienced elder law attorney is crucial for developing a comprehensive estate and financial plan that aligns with your specific needs and goals while ensuring Medicaid eligibility. An attorney can assess your financial situation, explain the various planning options, and guide you through the implementation process to protect your assets and ensure your loved one’s access to healthcare coverage.
Watchouts when applying for Medicaid
Medicaid has a look-back period. This means that Medicaid will review your loved one’s financial history for up to five years prior to the application to see if you have made any transfers or gifts that could be considered "uncompensated transfers." If Medicaid determines that you have made any such transfers, you may be penalized by having to wait a certain period of time before qualifying for Medicaid.
Medicaid has a filial support law. This means that Medicaid can go after adult children to recoup some of the costs of their parents' long-term care. However, there are several exceptions to this rule, such as if the adult child is disabled or has a low income.
Medicaid has an estate recovery program. This means that if your loved one receives Medicaid benefits and dies while she still has assets, Medicaid can claim those assets to reimburse itself for the benefits it paid.
To avoid these problems, it is important to consult with an attorney to discuss your individual circumstances and develop a plan to protect assets and qualify for Medicaid. To find a lawyer who specializes in elder care, visit Online Directory of National Academy of Elder Law Attorneys
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