Pennsylvania Medicaid Asset protection for Seniors
Don't Go Broke Paying for Nursing Care
One of the greatest fears of older Americans is that they may end up in a nursing home. This not only means a great loss of personal freedom, but also a tremendous financial cost. Regardless of what you've heard, it's never too late to protect your assets.
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Nursing Homes Costs in Pennsylvania, New jersey and Delaware average More Than $120,000 per Year |
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What's the Answer?
Medicaid Planning and Asset Protection
What is Medicaid Asset Protection?
Medicaid Asset Protection is the process of re-arranging / protecting assets from having to be simply “spent down” in connection with nursing home care or in-home care, while also helping ensure that you or your loved one gets the best possible care and maintains the highest possible quality of life, whether at home, in an assisted living facility, or in a nursing home.
Medicaid Asset Protection is the process of re-arranging / protecting assets from having to be simply “spent down” in connection with nursing home care or in-home care, while also helping ensure that you or your loved one gets the best possible care and maintains the highest possible quality of life, whether at home, in an assisted living facility, or in a nursing home.
When Should You Start This Type of Planning?
-Pre-Planning
If you are still healthy and have not yet begun the “long-term care continuum" - meaning when a person begins to need assistance with Activities of Daily Living [ADL's] (eating, dressing, bathing, toileting, transferring, and walking) or Instrumental Activities of Daily Living (such as cooking, cleaning, caring for pets, paying bills and managing finances) a big part of Medicaid Asset Protection Planning would involve our ElderCare Asset Protection Trust, which is a simpler and less expensive method of asset protection for clients who will most likely not need any long-term care for at least five years.
However, many of our clients come to us after their loved one needs assistance with ADL's and even after they have entered an assisted living facility or when nursing home care is already in place or is imminent.
This type of planning can be started while you are still able to make legal and financial decisions, or can be initiated by an adult child acting as agent under a properly-drafted Power of Attorney, even if you are already in a nursing home or receiving other long-term care assistance.
-Pre-Planning
If you are still healthy and have not yet begun the “long-term care continuum" - meaning when a person begins to need assistance with Activities of Daily Living [ADL's] (eating, dressing, bathing, toileting, transferring, and walking) or Instrumental Activities of Daily Living (such as cooking, cleaning, caring for pets, paying bills and managing finances) a big part of Medicaid Asset Protection Planning would involve our ElderCare Asset Protection Trust, which is a simpler and less expensive method of asset protection for clients who will most likely not need any long-term care for at least five years.
However, many of our clients come to us after their loved one needs assistance with ADL's and even after they have entered an assisted living facility or when nursing home care is already in place or is imminent.
This type of planning can be started while you are still able to make legal and financial decisions, or can be initiated by an adult child acting as agent under a properly-drafted Power of Attorney, even if you are already in a nursing home or receiving other long-term care assistance.
What are the Objectives of This Type of Planning?
With proper planning, families can obtain Medicaid assistance without having to deplete their life savings, impoverish their spouse and family and jeopardize their own quality of care. We focus on the following objectives:
– Protecting The Spouse
With proper planning, a spouse who is able to stay at home can keep all of the couple’s assets and all of the income while Medicaid pays for the nursing home. The most important goal is typically to ensure that the spouse remaining at home is able to live the remaining years of his or her life in utmost dignity and not have to suffer a drastic reduction in finances and in his or her standard of living.
– Protecting Quality of Life
If you are a single or widowed client, the most important reason for you to engage in asset protection planning is for you to be able to enjoy the highest quality of life possible in the event you are forced to enter a nursing home.
For instance, money that we protect for you in the process of getting you qualified for Medicaid can be used, once you are receiving Medicaid benefits, to provide you with an enhanced level of care and a better quality of life while you are in a nursing home. For example, we will often encourage the families of our clients to use the protected assets to hire a private “sitter” or “helper” – someone to keep you company, help you with meals, etc., somewhat like a “surrogate daughter.”
Money that we protect for you in the process of getting you qualified for Medicaid can also be used to purchase services or items for you that are not covered by Medicaid, such as dental work, vision aids, hearing aids, incontinence supplies, personal clothing and toiletries, and haircuts or salon/spa appointments.
– Protecting Children
Some parents have saved and sacrificed their entire lives and have a strong desire to leave a financial legacy for their children. With proper planning, this goal can be achieved while still qualifying for Medicaid.
– Protecting Disabled Persons:
There are asset protection strategies that will allow you to protect your home and an unlimited amount of assets for the benefit of a disabled child or other disabled family member.
With proper planning, families can obtain Medicaid assistance without having to deplete their life savings, impoverish their spouse and family and jeopardize their own quality of care. We focus on the following objectives:
– Protecting The Spouse
With proper planning, a spouse who is able to stay at home can keep all of the couple’s assets and all of the income while Medicaid pays for the nursing home. The most important goal is typically to ensure that the spouse remaining at home is able to live the remaining years of his or her life in utmost dignity and not have to suffer a drastic reduction in finances and in his or her standard of living.
– Protecting Quality of Life
If you are a single or widowed client, the most important reason for you to engage in asset protection planning is for you to be able to enjoy the highest quality of life possible in the event you are forced to enter a nursing home.
For instance, money that we protect for you in the process of getting you qualified for Medicaid can be used, once you are receiving Medicaid benefits, to provide you with an enhanced level of care and a better quality of life while you are in a nursing home. For example, we will often encourage the families of our clients to use the protected assets to hire a private “sitter” or “helper” – someone to keep you company, help you with meals, etc., somewhat like a “surrogate daughter.”
Money that we protect for you in the process of getting you qualified for Medicaid can also be used to purchase services or items for you that are not covered by Medicaid, such as dental work, vision aids, hearing aids, incontinence supplies, personal clothing and toiletries, and haircuts or salon/spa appointments.
– Protecting Children
Some parents have saved and sacrificed their entire lives and have a strong desire to leave a financial legacy for their children. With proper planning, this goal can be achieved while still qualifying for Medicaid.
– Protecting Disabled Persons:
There are asset protection strategies that will allow you to protect your home and an unlimited amount of assets for the benefit of a disabled child or other disabled family member.
What is an Asset Protection Plan?
The Asset Protection Plan is broken down into a number of sections:
– Background
In this section, we confirm what you’ve told us about your health, income, assets, and expenses. This is important because the entire plan is based on this information. If your information is different, the plan will be different. We want to be sure that we understand your situation completely.
– Objectives
Why do we do asset protection planning? As mentioned above, most of our client are interested in protecting their assets
(a) for themselves, to be able to enjoy the highest quality of life possible within the confines of a nursing home;
(b) for their spouse, if married, who will be remaining in the community, and
(c) possibly for the benefit of their children.
Some people also have specific goals relating to disabled beneficiaries, or related to their home or to federal and state income taxes, or federal and estate gift taxes. Every plan must be customized to achieve your specific goals on the basis of your specific income, assets, expenses, and health conditions.
– Applicable Law
We discuss the Medicaid law, tax law, and, where appropriate, the laws relating to Veteran’s Aid and Attendance.
– Strategy
There are dozens of different strategies that can be employed to protect assets. We walk you through each of these strategies that apply to your situation and discuss them with you to determine which ones appeal to you and would work for you and which ones are inappropriate. Whenever possible, we compare strategies and give alternatives.
– Assumptions
Our clients are often unable to give us all of the information which we would need to make a perfect plan. For example, many people do not know:
– Additional Considerations
This section is an attempt to answer the common questions which people have and avoid the ordinary pitfalls.
– Action Plan
This is a summary of the exact steps that need to be taken to implement the plan.
– Implementation
Our office assists you to the extent possible in seeing that this is done. For example:
The Asset Protection Plan is broken down into a number of sections:
– Background
In this section, we confirm what you’ve told us about your health, income, assets, and expenses. This is important because the entire plan is based on this information. If your information is different, the plan will be different. We want to be sure that we understand your situation completely.
– Objectives
Why do we do asset protection planning? As mentioned above, most of our client are interested in protecting their assets
(a) for themselves, to be able to enjoy the highest quality of life possible within the confines of a nursing home;
(b) for their spouse, if married, who will be remaining in the community, and
(c) possibly for the benefit of their children.
Some people also have specific goals relating to disabled beneficiaries, or related to their home or to federal and state income taxes, or federal and estate gift taxes. Every plan must be customized to achieve your specific goals on the basis of your specific income, assets, expenses, and health conditions.
– Applicable Law
We discuss the Medicaid law, tax law, and, where appropriate, the laws relating to Veteran’s Aid and Attendance.
– Strategy
There are dozens of different strategies that can be employed to protect assets. We walk you through each of these strategies that apply to your situation and discuss them with you to determine which ones appeal to you and would work for you and which ones are inappropriate. Whenever possible, we compare strategies and give alternatives.
– Assumptions
Our clients are often unable to give us all of the information which we would need to make a perfect plan. For example, many people do not know:
- What day they will enter a nursing home
- What nursing home they will enter
- How much it will cost
- When and how often the nursing home will raise its rates
- How much will be covered by Medicare,
- How much private pay money is required by the nursing home as a condition of admission
– Additional Considerations
This section is an attempt to answer the common questions which people have and avoid the ordinary pitfalls.
– Action Plan
This is a summary of the exact steps that need to be taken to implement the plan.
– Implementation
Our office assists you to the extent possible in seeing that this is done. For example:
- If real estate needs to be transferred to a spouse or child, our office will prepare the deed and record it for you.
- If you need to deal with financial institutions or insurance companies, our office will obtain all the necessary forms for your signature.
- If the plan calls for the purchase of an annuity, our office will assist you in dealing with the insurance company to be sure that a policy is furnished that will meet the ever-changing Medicaid requirements.
- Filing the Medicaid Application: The final phase of the process for the Medicaid long-term care assistance. Every item on the application must be documented and explained. We will do everything needed to prepare and file the application for you, and we will also be the ones to answer questions that the Department of Social Services may have about the application.
What is Medicaid Planning?
Medicaid planning is the process of protecting your hard earned assets from the growing cost of Long Term Care. More than 70% of Americans over the age of 65 will need Long Term Care Services. Many nursing home residents end up exhausting their savings and assets on long-term care costs leaving their family with nothing but a huge bill for the nursing care that was provided. Medicaid Planning will avoid losing your hard earned savings and assets.
Medicaid planning is the process of protecting your hard earned assets from the growing cost of Long Term Care. More than 70% of Americans over the age of 65 will need Long Term Care Services. Many nursing home residents end up exhausting their savings and assets on long-term care costs leaving their family with nothing but a huge bill for the nursing care that was provided. Medicaid Planning will avoid losing your hard earned savings and assets.
With Proper Planning Techniques, We Can Show You:
- How you can qualify for Medicaid benefits even if you have savings, a home and other assets.
- What you'll need to know if family members are providing care for a loved one.
- How a married couple can keep all of their savings and their home if one spouse must enter a nursing home.
- How the spouse in the nursing home can pass their income to their wife or husband.
- How a single individual can protect their assets and their home [many people believe that asset protection is for married couples only, we'll show you how that's not true].
There are generally 2 categories of Medicaid Planning, "Pre-Planning" and "Crisis Planning".
Pre-Planning:
Medicaid has what is known as a "look back period". What that means is, they will audit an applicants financial history for the previous 60 month period from the date of the Medicaid application [or date of continuous facility stay] . If there are any financial transactions that have taken place [outside of the allowable guidelines] they will impose a "penalty" [a period of ineligibility]. Pre Planning takes place when an individual begins financially planning 60 months or more prior to needing nursing home care. Pre Planning allows for a greater number of options in strategies to be used in order to preserve the maximum amount of savings and assets, a very popular tool is our Medicaid Trust which will protect your assets. Pre planning will also make applying for Medicaid much easier because upon the need to nursing home care you will already know that meeting the guidelines will not be difficult and will not result in a loss of savings or assets.
Medicaid has what is known as a "look back period". What that means is, they will audit an applicants financial history for the previous 60 month period from the date of the Medicaid application [or date of continuous facility stay] . If there are any financial transactions that have taken place [outside of the allowable guidelines] they will impose a "penalty" [a period of ineligibility]. Pre Planning takes place when an individual begins financially planning 60 months or more prior to needing nursing home care. Pre Planning allows for a greater number of options in strategies to be used in order to preserve the maximum amount of savings and assets, a very popular tool is our Medicaid Trust which will protect your assets. Pre planning will also make applying for Medicaid much easier because upon the need to nursing home care you will already know that meeting the guidelines will not be difficult and will not result in a loss of savings or assets.
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"Crisis" Planning:
Crisis Planning is our specialty, this type of planning occurs when an individual is either in or will be entering a nursing home within the next few months. This is a critical moment, it is absolutely imperative that you contact us as soon as possible to preserve the greatest amount of your assets as possible. While "crisis" planning does limit the number of strategies available for asset preservation, there are still strategies known to us that will generally allow us to preserve 100% of a couples assets. |
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What We Can Do for You:
- Protect your Home - Medicaid applicants do not have to sell their homes in order to qualify for Medicaid. A spouse can remain in the home indefinitely and In "crisis" planning, we can show you how a single individual can protect their home for 6-12 months after entering a nursing home [in certain circumstances indefinitely] . With pre-planning we can show you how to protect the home and keep it in the family for both individuals and spouses. Properly protecting your home may avoid the estate recovery.
- Protect your retirement funds and investment accounts - Some states differ but generally, the retirement accounts that you and your spouse have will be considered a "countable resource" when applying for Medicaid. and therefore, will have to be protected and preserved for you and your family.
- Protect your life Insurance - if you and/or your spouse has life insurance, if left unprotected, you may be required to liquidate the policy and possibly use the proceeds from the cash value in the "spend down process". Medicaid only allows a cash value of $1,500 or less in a whole life policy, term policies are exempt because they do not build cash value. Properly protecting your policies will allow you retain your death benefit for your family.
- Protect your income - The income of the healthy spouse at home [known as the"community spouse"] will continue undisturbed; he or she will not have to use his or her income to support the spouse receiving Medicaid benefits. If most of the couple’s income is in the name of the spouse in the nursing home and the community spouse’s income is not enough to live on, the community spouse may be entitled to some or all of the income of the institutionalized spouse.
- QIT or Miller Trust - some states are known as "income cap" states for the purpose of Medicaid benefits. Meaning they impose a "cap" on the income that a person can earn each month in order to qualify for Medicaid benefits. So, for those who's gross monthly income is above the state's limit they must establish what is known as a Qualified Income Trust [QIT] or also known as a "Miller Trust". When properly drafted and managed a QIT will allow this individual to qualify for Medicaid benefits. Our experienced attorneys can draft these trust documents for you and help ensure that you can financially qualify for Medicaid benefits.
- Resolving Eligibility Issues
- Medicaid Trusts - click HERE to learn more about how our Medicaid Trusts will protect your assets.
- Asset re-assignment - 1. life insurance policies - almost always, spouses name each other as beneficiaries in their life insurance policies, while for everyday life this is great, however, when a spouse enters a nursing home and begins receiving Medicaid benefits it's imperative that you re-name beneficiaries for your life insurance policies. Why? Because if the "healthy" spouse living at home were to pass before the spouse in the nursing home he or she would would receive the death benefit and therefore disqualifying them from Medicaid benefits. 2. Wills - just as with life insurance policies a Will could disqualify an individual form receiving Medicaid benefits if they were to inherit assets if the at home spouse were to pass first. 3. Real estate - as above, if the spouses own a home together, the spouse receiving Medicaid benefits should be removed from the deed of the home. If the at home spouse were to pass first, the individual receiving benefits would then be the owner of the home and the home would need to be sold and the proceeds used for their care.
Don't Sell Your Home, Give Away or "Spend Down" Your Assets Before Calling Us
If you have a loved one currently in a nursing home or who will need nursing home care
contact us today to preserve your family's assets
learn more...contact us today!
Medicaid Plus, LLC provides Medicaid Planning, Medicaid Application Assistance and Legal Services for Long Term Care Providers in Pennsylvania, New Jersey, Maryland and Delaware. Our on staff elder law attorneys can also prepare legal documents such as Wills, Powers Of Attorney [financial and health care], Advanced Directives, Living Trusts, Asset Protection, Irrevocable Trusts and more.
