How to Navigate Medicaid Crisis Planning

How to Navigate Medicaid Crisis Planning

Medicaid is a program for people with a low income and few resources to help them pay for the cost of obtaining healthcare. Although the federal government oversees Medicaid, each state determines who qualifies for coverage and the types of treatment it will cover. Medicaid crisis planning is sometimes necessary when a family member needs to move into a long-term care facility with little notice. A stroke that leaves a loved one cognitively impaired and unable to care for themselves is just one example.

Medicaid Crisis Planning Can Help Clients Retain a Lifetime of Savings

Your spouse or parent worked hard all their life, paying their bills on time and putting money aside to leave for the next generation. Unfortunately, the high cost of long-term care means that it could be gone within weeks after moving into a nursing home. The elder law firm of Beasley & Ferber works with clients and their families to determine the best strategies to use to prevent them from losing their life savings.

Here are just some of the factors we consider before providing the family with legal advice:

  • Age and life expectancy of the person needing long-term care
  • The health condition that necessitates long-term care
  • Types of assets in their estate
  • Unique family circumstances, such as a person who needs care having gone through a divorce previously but has since remarried. The new spouse may have a conflict with the adult children over the best course of action for their loved one.

People who apply for Medicaid based on sudden health needs often receive a denial because their income, assets, or both are too high. If you transfer assets suddenly on behalf of your loved one, the government will learn about it during its five-year look-back period. However, certain types of transfers are legal and will not invite government scrutiny. These include:

  • Transferring to a spouse or another adult who manages the financial affairs of the spouse.
  • Establishing a trust for the benefit of a disabled individual under the age of 65.
  • A trust for the benefit of a blind or disabled biological or adopted child, regardless of age. These funds can also go to the benefactor directly.

Persons applying for emergency Medicaid can also transfer their home to someone else if the transaction meets each of the following criteria:

  • The person receiving the title to the home is a son or daughter who is at least 21 years old.
  • An adult child lived with a parent for at least two years before the parent needed nursing home care and provided direct care up to that point.
  • A sibling of the Medicaid applicant with equity in the home lived there for at least one year before the other sibling needed long-term care.

Although you can transfer assets in any of these situations to have your loved one qualify for emergency Medicaid, we recommend that you seek advice from our elder care law firm first. We will ensure the transaction you are considering is legal and offer additional recommendations to help your family at this challenging time. Contact us to schedule an appointment today.