Most clients think Medicaid Planning protects their money. Sometimes it just moves it somewhere they can’t reach. This is Medicaid Planning for financial advisors in Indiana: what your clients are being sold, and what it may actually cost them.
Key takeaways
Your clients are hearing that they will “lose everything to a nursing home.” Some of the planning sold in response costs more than the risk it addresses.
- Attorney-driven fear to sell “legal” solutions. $10–20,000+ fees, instructions to empty IRAs, and investing in annuities with up-front fees are the common products behind the pitch.
- The fear drives more complex planning than most need. Not all assets count toward Medicaid’s resource limit, and nursing homes, themselves, don’t have limits.
- The extended cost is normally not disclosed. Large IRA withdrawals cause major income tax issues and Medicare IRMAA surcharges, the upfront annuity fees are not disclosed until later, and no explanation that your client may want to private pay for higher levels of care which isn’t covered by Medicaid.
- Planning does not fix the timing problem. Many desired Medicaid options, e.g. Home-based Waiver and Assisted Living options, have waitlists of 12 months or more, which will require private pay.
- Attorneys should not be leading this conversation. It should be you. As a trusted, long-time advisor, you know the whole financial picture. You’ve probably discussed this concern with your clients as part of their financial plans and goals. Most attorneys aren’t licensed to give financial advice and certainly have far fewer strategic ways to address your clients’ appropriate plan.
What is at stake for you and your client
This is not only a legal question. When a client acts on fear-based planning without their advisor in the room, two things are at risk.
- Your client can be materially harmed. Together, these costs can reach tens of thousands of dollars, and some, like higher Medicare premiums, hit every month. A client may also lose access to a preferred care option that requires private pay, and a surviving spouse can lose independence through forced splitting of joint property.
- You can lose the relationship and the assets. Money pulled from managed accounts to pay a fee, fund an irrevocable structure, or buy a product from an unknown provider may result in the end of a long-term client. Worse, when the outcome disappoints, the client may also question why you let it happen.
These decisions are often made in a single meeting. It is singularly focused on leveraging a concern that most people have, on some level, about the cost of healthcare in the waning years. Even when the client is healthy, has little-to-no immediate health concerns on the horizon, has the resources to comfortably cover anything that they would face, the attorney approach feeds the fear of losing everything.
Why this matters now
Indiana’s Medicaid waiver wait lists have changed the planning conversation.
Planning fees can help a client qualify for Medicaid, but that doesn’t mean a preferred service will be available. If funds are tightly “protected,” they may not have the money to pay privately while they wait for an “invitation” off the list.
Indiana PathWays for Aging is the primary Medicaid program providing non-nursing home support for people 60+. This may allow some help at home or a higher level of care assisted living option. They are great programs, if you can get in. As of October 2026, PathWays has a 12,600-person waiting list. (Source: FSSA, HCBS Medicaid Waiver Waiting List Information, updated October 14, 2026)
Depending upon which service within PathWays a person wants/needs, the time on the waitlist has been 12 or more months. No attorney planning, regardless of cost or number of books involved, shortens that wait.
This aggressive planning requires a “slot” in a particular program to be available. There are caps on program slots across the State. Even when there are empty rooms or available services in facilities, to have Medicaid cover the cost, a slot has to be assigned. Until then, private pay or family coverage is the only option, short of a Medicaid nursing home bed, which few people want, even when it is the right care.
One thing rarely mentioned in the “nursing home” conversation is the range of options between living at home and a full-care nursing home. A traditional assisted living arrangement has independent patio homes or apartments, some or all prepared meals, check-in services, med management, and social activities. Those situations may be a perfect transition from a big house and yard to less burden with independence. Those independent to assisted living options are always private pay.
This is where a large planning fee can backfire. A client who paid tens of thousands in attorneys’ fees and taxes to “protect” assets won’t have full access to use those assets to live the quality of life they may choose.
It’s getting aggressive
The number of advisors who have told me about clients coming to them to transfer money to cover attorneys’ fees is growing. One attorney didn’t even wait for his clients to come to the advisor. He called the advisor with them in the meeting to say the advisor needed to send $20,000 to stop the clients from losing everything to a nursing home.
Neither of them was going into a nursing home anytime soon.
The other thing I hear is more clients are coming to their advisors with strict, no-questions-asked instructions to withdraw all their money from their accounts, including IRAs, immediately so it can be protected. Many clients are so overwhelmed and concerned about losing everything, they won’t listen to reason about the tax consequences.
How we work with advisors
We have helped hundreds of families with long-term care planning. We believe clients are best served when their attorney and their financial advisor know each other and work together. Each of us is licensed to give advice the other cannot.
- Flat, defined fees. Our normal range is $3,000 to $5,000, including the application through a decision.
- Right-sized planning. It is rare for us to make substantial asset transfers or to use asset protection trusts or transfer money out to Medicaid-compliant annuities.
- You stay in the conversation. We want you involved before large withdrawals or transfers are considered.
- Planning when care cannot wait. We also plan as part of the application process when a care need arrives without much warning.
Call before assets move. Most of these decisions are hard to undo, and the tax cost is usually set in the year of the withdrawal.
Share this with your clients
The companion piece, Indiana Medicaid Wait Lists: What to Tell Your Clients, has what to say, what doesn’t count toward Medicaid’s limit, and questions your clients can ask any attorney. The client-facing version for families is Indiana Medicaid Wait Lists: Before You Pay for Planning. For a deeper look at how planning is priced, see What Medicaid Planning Is and Why People Overpay for It.
This brief is general information for financial professionals. It is not legal advice, and reading it does not create an attorney-client relationship. Every client situation has details that change the answer.
Sources
Figures as of October 19, 2026.
- FSSA, HCBS Medicaid Waiver Waiting List Information
- Indiana Long Term Care Insurance Program, Medicaid Assets & Income
- Indiana Medicaid Eligibility: 2026 Income and Asset Limits (American Council on Aging)
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