You may not understand why Medicaid would be relevant to you if you are going to qualify for Medicare when you attain senior citizen status.
It is true that both of these programs are government health insurance programs. If you have Medicare coverage, you would not need Medicaid at first. Plus, Medicaid is a need-based program. If you retire with some income and resources, you would not meet the eligibility requirements.
In spite of the above, Medicaid does become relevant to a significant percentage of senior citizens. This is because Medicaid will pay for long-term care.
The Medicare program will not pay for custodial care. It will assist with medical expenses and convalescent care, but it will not be of assistance if you need help with your activities of daily living.
People who were never poor typically qualify for Medicaid by giving assets to their loved ones. They essentially distribute inheritances in advance.
However, you must be proactive, because there is a 60 month Medicaid look-back. You have to complete your spend down at least five years before you apply for Medicaid coverage.
If you give away assets within this five year window, your eligibility is delayed. The length of the penalty depends on the amount of the divestitures as they compare to the average cost of long-term care in New York.
To explain by way of example, let’s say that the average cost of nursing home care is $100,000 per year. You gave away $200,000 within this five-year time frame. Under these circumstances, your eligibility would be delayed by two years, because you gave away enough to pay for two years of nursing home care.
When you think about long-term care, you may immediately think about nursing homes. However, some seniors can receive the help that they need in their own homes. There are paid in-home caregivers that will come to you on an as needed basis. This type of care is not inexpensive, but it is less expensive than full-time residence in a nursing home.
If you need in-home care, you may qualify for a Medicaid waiver. This program is called a waiver program because the eligibility requirements are not as stringent as they are for full-blown Medicaid coverage. Formally, the program is called the Medicaid Home and Community Based Services waiver program.
Staying at home can be a better choice for many people. Money is saved, eligibility for government assistance is more easily attained, and you don’t have to uproot yourself and enter unfamiliar surroundings.
Medicaid Planning Consultation
If you would like to learn more about the Medicaid program, our firm can help. We offer free consultations, and you can send us a message through this page to request an appointment: Smithtown NY Medicaid Planning.
Visit Our Forbes Page
To access more estate planning and elder law content, visit our Forbes page: Forbes Contributor Mark Eghrari.