Medicaid provides several programs funded through a state-federal agreement, explains the article “Planning a must: Medicaid and paying for nursing homes” from The Dallas Morning News. One of the programs provides long-term nursing home care benefits to pay for nursing home or approved residential care facilities (“skilled nursing care”) for elderly and disabled people who qualify. However, requirements to qualify for Medicaid vary widely from state to state. Medicaid does not pay for assisted living costs. It’s best to speak with an elder law attorney, who will be able to help you plan in advance for needed care.
In Virginia, for example, you must have a medical need and fall under the asset caps, which can change yearly. Our asset (“countable resource”) amount is $2,000 for a single person. For a married person, your spouse can have an amount of countable resources that ranges from $25,728 to the maximum is $128,640, depending on circumstances. There is a monthly maintenance needs allowance for a non-disabled spouse. If this sounds like not much money, that’s right. However, there are some assets that do not count. The well spouse may continue to maintain the family home. A car, burial plots and prepaid funeral arrangements are also permitted.
For most people, this presents a bad situation. Their assets are too high to qualify for Medicaid, but they don’t have enough money to pay for nursing home care. That’s where Medicaid planning with an elder law attorney comes in. The attorney will know where assets can be properly shielded to protect the well spouse and how to work within the Medicaid requirements.
A word of advice: Don’t start giving away assets because you think that you can do this yourself. The first rule: there is a five-year lookback period, and if assets have been distributed within a five year period of the person applying for Medicaid, their eligibility will be delayed. The good news? Virginia allows unlimited transfers between spouses, and the five-year rule does not apply. The rules about gifting assets are complicated and mistakes are non-negotiable. Check with a qualified elder law attorney before making gifts or transfers.
Be careful of elder exploitation. Planning for Medicaid is one thing, being convinced to impoverish yourself so someone else can have a luxurious lifestyle is another. There’s a fine line between the two. Be aware of the difference. An attorney can play an important role here, since they have a legal and ethical responsibility to protect their client’s interests.
Be certain that you have a Durable Power of Attorney in place. Why? If you become incapacitated during the process of Medicaid planning, your agent will be able to help with Medicaid planning and file for the Medicaid application.
In general, this is not a time to sell your home. In most states, the primary residence is a protected asset for Medicaid for limited periods (or as long as your spouse lives there). If you sell it before applying for Medicaid, however, the proceeds of the sale are considered a personal asset and will be counted.
It’s also important to understand that Medicaid does not pay for all nursing home stays. Medicaid pays for a nursing-home designated “Medicaid bed” in a semi-private room. Depending on where you live, there may not be as many Medicaid beds as there are people who need them.
An elder lawyer will be able to help you and your family with planning for Medicaid, and with an application. You’ll be better off relying on the help of an experienced attorney.
Reference: The Dallas Morning News (March 15, 2020) “Planning a must: Medicaid and paying for nursing homes”