Currently, Medicaid pays more than half of the long-term care expenses in nursing homes in the U.S. To receive such support, a person needs to understand the Medicaid Application and Medicaid Eligibility process. It is also important to understand that your situation is different than anyone else. You should discuss how the rules and eligibility apply to you.
What exactly does Medicaid do? When does Medicaid come into play? How does a person “get” Medicaid? These questions cause a great deal of confusion and concern for those seeking nursing home care. Two of the more confusing Medicaid Eligibility “rules” are the 5-year look-back and the spend-down.
For example, recently, I spoke with two people caught in the Medicaid morass. Here, I’ll address the question of care at home and concern for what Medicaid will allow for a child that has paid out a great deal to care for “mom.” The next article will discuss Medicaid, in-home care, and hospice care.
The first call involved a daughter concerned about her mother’s degenerating condition. Like many people, she wants to help her mother stay at home as long as possible. Her condition requires the daughter to be with her most of the day. Since she lives next door, it is convenient. However, the daughter gave up her job to help. Plus, she cannot leave town for a family vacation – even for the weekend – because her mother needs someone there every day.
Another common issue in this situation is the financial “investment” she made to help her mother cover living expenses.
She researched information on the web, including the Medicaid Application. She found some things unclear and more stress caused by others. Over the years, she purchased property for her mother. She also spent money on other needs. Her concern: Can she be paid back if a nursing home becomes necessary.
For Medicaid qualification purposes, a transfer for less than fair market value creates a period during which Medicaid won’t pay expenses. The five-year look-back is time Medicaid looks at possible transfers for less than fair market value.
The important element is the “transfer for less than fair market value.” If a person sells items or buys items or services for fair market value, there is not a penalty. If someone pays for services or items for the Medicaid applicant, repayment is possible. To be repaid, the person needs documentation, e.g., receipts, checks, etc. that tie to the applicant’s care or needs.
In planning, you may sell property or an asset spend-down to meet countable resource requirements. In a good plan, if a person helped financially for the applicant, part of the spending repays money to the person.
We use the term “spend-down” in a number of places when applying for Medicaid Eligibility. One situation is when a married couple with one applying for Medicaid. After a countable resource evaluation, some resources may need to be spent-down to reach the eligibility thresholds. It is essential to determine the amount required to spend and the options to re-position assets so they are not countable. The options for consideration are dictated by the type of assets and the specific circumstances of the couple.
A single person Medicaid Application may also need to spend-down money to reach eligibility. In both cases, a proper plan provides the applicant, and spouse if married, receive proper care, cover their needs as necessary, and manage the spend-down process effectively.
The lady I spoke with had circumstances which require specific planning to help her mother in the best way possible. With a well-designed plan, we can manage the spend-down in a way that protects property interests, re-pays expenses, and allows her mother to receive the best care, cost-effectively now.
Be aware, attorneys’ fees cover a wide range from several thousand dollars to as much as fifteen thousand. Be sure that the plan options you choose accomplish what you want. Also, be sure you understand the ramifications of each option.
One other thing to keep in mind – a nursing home does not have the same approach to counting assets as Medicaid. A nursing home wants a client to pay at a private rate as long as a client can pay the private rate. Understand your options before you find yourself in a position where someone else makes decisions for you.
The Medicaid Application is easy to find online and it seems easy to fill out. However, many people start on their own only to be rejected. The next steps of the process leave people unsure what needs to happen to gain Medicaid Eligibility. There are important strategies, information, and proper ways to go through the Medicaid Application process.
I invite you to take advantage of a free consultation to understand the options unique to your situation. Call 219-230-3600 or visit meetme.so/rgskadberg to find a time that works with your schedule.