The need for long-term care is a reality that most Americans will face at some point in their lives. In fact, according to the U.S. Department of Health and Human Services' Administration on Aging, someone turning age 65 today has a nearly 70 percent chance of needing some kind of long-term care services in their remaining years.
Unfortunately, the cost of long-term nursing care is astronomical—with annual costs reaching into the six-figure range—and continues to rise with each year that passes. If you and your family can't afford an expense of that magnitude, you're not alone.
Many people need assistance to pay for long-term care. When that happens, government programs like Medicaid can step in to provide much-needed services and support. Not only can Medicaid cover such expenses, but it is actually the primary source of payment for long-term care, shouldering between 45 percent and 65 percent of the country's total nursing home costs.
However, as an income-based, means-tested program, Medicaid has strict income and asset limits, and qualifying for the care you need often requires careful and thorough advance planning. Sadly, when it comes to Medicaid planning for long-term nursing home care, damaging myths and misconceptions abound, and falling for one can have serious repercussions. Don't risk it. Professional help is available.
Compassionate Virginia Medicaid Planning Attorneys
Medicaid rules are complex, which can make the planning process confusing, frustrating, and overwhelming. At Cucinelli Geiger, PC, our team of knowledgeable, experienced, and compassionate Medicaid planning attorneys can help you structure finances and draft legal documents to qualify for long-term nursing care benefits. We will also work to banish myths and misconceptions that could cost you money or delay your eligibility for Medicaid nursing home coverage.
Common Medicaid Long-Term Care Myths
Where did you learn what you know about using Medicaid to pay for a nursing home? Was it from a friend, family member, or neighbor? Was it something you saw on television or in a movie? Or are they assumptions you've picked up along the way, and you're not even sure where, when, or from whom you learned them? Myths and misconceptions on these topics are everywhere. Don't be tempted to "go with your gut" or trust advice you heard through the grapevine. Here are just a few examples of the Medicaid myths you may encounter.
Myth: You Don't Need Medicaid If You Already Have Medicare
Medicare can pay for some long-term care, provided you meet certain requirements. Unfortunately, even in the best of circumstances, Medicare will only pay for up to 100 days of skilled nursing care, and the program only covers partial care costs during the majority of that time. Also, the "skilled" distinction is particularly important. If Medicare determines that you received "custodial care" rather than "skilled care," the program could decide to pay nothing, leaving you with an unexpected financial burden. Medicare and Medicaid are not the same. Medicaid provides benefits and services that Medicare does not. Don't make the mistake of confusing the two programs.
Myth: You Have to Spend All of Your Money to Qualify for Medicaid
While this is a common misconception, it is absolutely false. Regardless of whether you're a single or married applicant, you can receive some income and own some assets and still qualify for Medicaid benefits. Examples of resources considered exempt for eligibility purposes include:
- One vehicle
- One home
- Personal property and household furnishings
- Prepaid funeral arrangements and burial plots
- Trade or business property essential to self-support
- Assets that cannot be converted to cash
Our experienced attorneys can recommend planning solutions to help you qualify for Medicaid while preserving resources for a spouse or other family members.
Myth: Medicaid Will Take Your Home
When a Medicaid recipient dies, the state can recover the cost of the care the program provided from the decedent's estate. Medicaid defines an estate as:
- All real and personal property and other assets held by the recipient at the time of death
- All other real or personal property or other assets in which the person had any legal title or interest at the time of death
However, when one spouse applies for Medicaid long-term care benefits, the family home is exempt if the other spouse still lives there. Even the home of a single applicant can be exempt for a time. Additionally, when the Medicaid beneficiary dies, the state cannot initiate the estate recovery process if the spouse, a dependent, or disabled child survives them. Talk to our attorneys about ways to ensure your home is protected.
Myth: Your IRA Is Protected
When determining eligibility for Medicaid long-term nursing care, IRAs are considered assets like any other. They aren't automatically exempt. Our legal team can help you explore solutions for protecting an IRA.
Myth: Joint Accounts Are Protected
Setting up a joint account with another person doesn't protect the funds in the account from Medicaid. Regardless of who shares the account, Medicaid considers it money that the applicant can and should access to pay for their long-term nursing home care. If the account only requires a single signature for withdrawal, all of the money is considered a "countable asset." For accounts where two signatures are required, Medicaid considers one-half of the money as a "gift" transferred to the applicant when the joint account was opened.
Myth: You Can Give Away a Certain Amount of Money Per Person Each Year Without Penalty
You're thinking of gift tax law. While you can give away up to a certain amount per person per year without paying a gift tax, Medicaid penalties still apply for improper transactions made during the five-year look-back period.
Myth: It's Too Late to Protect Your Assets
Although Medicaid planning is best done well in advance of any need for long-term nursing care, sometimes life takes you by surprise, and you find yourself needing this care much sooner than expected. Fortunately, it's never too late to protect at least some of your assets. If you're faced with an immediate or near-immediate need, our resourceful attorneys can help you explore your Medicaid crisis planning options.
Schedule a Consultation
Contact us today to schedule a consultation to discuss your Medicaid eligibility and planning needs.