Medicaid is a joint federal-state program that gives low-income people medical assistance as long as their assets and monthly income fall below a certain level. Many people depend on Medicaid to pay their nursing home bills, and it is a last resort for people who do not have the means to otherwise finance long-term care when they are elderly, blind, or disabled. You may be worried that you will lose your home, life savings, or other assets in order to qualify for Medicaid. It is best to retain a Harrison or Panola County Medicaid planning lawyer to help you with preparing for nursing home care or disability needs while you are still healthy. Shelia McCoy assists aging Texas residents with developing strategies in this area.Understanding Medicaid Planning Strategies
Your qualification for Medicaid depends on your assets and monthly income. If they are too high, you will not qualify. Not everyone is aware that certain assets can be exempt. Texas is only allowed to count income or assets that are legally available to pay bills. Through Medicaid planning, you can use legal strategies to shield your income and assets so that you can qualify. This will allow assets to be preserved for loved ones and provide for a healthy spouse if you happen to be married. The strategies are complex, and there are many restrictions. Accordingly, you should consult an experienced attorney to assist you with Medicaid planning.
Your countable assets determine whether you qualify for Medicaid. Countable assets include any property that can be liquidated for cash, including stocks, IRAs, mutual funds, and bank accounts.
Each state has its own list of exempt assets. In Texas, your home, one vehicle, and a prepaid burial plan are exempt. Couples are limited in their assets and income if they both apply for Medicaid, and the limit may change on an annual basis. A Medicaid planning attorney in Harrison or Panola County can explain any changes in the limits. The limits can be even more complicated if one spouse needs Medicaid, while the other does not. The spouse who does not is called a community spouse, and they can keep at least $24,180 and 50% of assets up to $120,900 in countable assets. However, the assets of the institutionalized spouse, aside from the exempt assets, must fall below a certain limit.
Countable assets may be sheltered in some cases so that they can provide financial assistance to your loved ones, rather than being liquidated to pay for your care. One method of sheltering assets is by creating an irrevocable trust. Any property you put in an irrevocable trust is excluded from consideration when determining your eligibility for Medicaid. You need to fund the trust for a certain period of time and name an appropriate beneficiary to shelter what you have put in the trust. However, if there is a discretionary clause that allows the trustee to distribute assets to your spouse or you, and both of you are named beneficiaries, Medicaid will still count those assets as available to the individual. Only when the trustee does not have discretion to distribute the assets will they not be counted.
Another method of making yourself eligible for Medicaid is to create a Miller Trust or a qualifying income trust. This entails placing instructions on your checking account so that income over the monthly cap is diverted into a trust for the purposes of maintaining eligibility for Medicaid. A Miller Trust is designed to process your income so that you meet the rules, but most of the money going into the trust is used to pay nursing home costs. Rarely is any significant amount of money remaining in the trust by the time that you pass away. The state can recover from any remaining sums what it spent on you, and once the state is repaid, the remainder will be paid to the beneficiaries whom you have named.
Texas has the right to review your finances (and those of your spouse) for a 60-month look-back period before the date that you apply for Medicaid to review any transfers of countable assets for under market value.
If the state sees a transfer of a countable asset for less than fair market value during that period, it will apply a waiting period before providing Medicaid. People who do not realize this may try to gift their home to their adult kids in the months before they go into a nursing home. This will result in ineligibility for Medicaid for a long period, unless the transfer meets one of the exceptions. For example, there is a caregiver child exception when a child lives in the transferred house for two years, providing care that delayed the need for long-term care.Consult a Medicaid Planning Lawyer in Panola or Harrison County
There are also other strategies that you might consider beyond those discussed here. If you need to plan for qualifying for Medicaid, consult Shelia McCoy. This area of law is quite complicated, and it is important to retain an experienced Harrison or Panola County Medicaid planning attorney to make sure that you are following the current rules to qualify. Call us at (903) 935-1190 or use our online form to set up your appointment. We also represent people who need a family law attorney in communities such as Carthage, Beckville, DeBerry, Gary, Tatum, Marshall, Longview, Waskom, Elysian Fields, Harleton, Karnack, Hallsville, and Scottsville.