To effectively avoid Medicaid's 5-year retrospective period, you must transfer your assets to the irrevocable trust (also called a Medicaid trust) long before you apply for Medicaid benefits, preferably at least 5 years and one day before. Keep in mind that not just any irrevocable trust will do. Medicaid asset protection trusts are specifically designed to circumvent the rules governing the requirements to receive Medicaid benefits and avoid selling your estate after your death to reimburse Medicaid for services provided during your lifetime. When determining eligibility, Medicaid ignores some (active) resources because it does not consider them to be available to pay for home care near Siler City NC.
These annuities convert a lump sum of cash into a monthly income stream for the applicant, reducing their assets to meet Medicaid requirements. This means that all 50 states don't have the same rules for their Medicaid programs nor do they have the same rules for their retrospective period. It's important to understand how Medicaid works and how it can be integrated into a comprehensive plan to fund long-term care needs. Medicaid allows seniors to set aside a small amount of money for the sole purpose of covering funeral and burial expenses. However, when you give away property within five years of applying for Medicaid long-term care, Medicaid presumes that the donation was made to qualify for Medicaid. While Medicaid funds most long-term care in this country, it's supposed to be the payer of last resort when it comes to nursing homes, assisted living, and home health care.
If you are applying for Medicaid for nursing homes or a Medicaid exemption for home and community-based services (HCBS), the state agency that governs Medicaid will review past asset transfers. If Medicaid says you made a transfer that involves a period of ineligibility, you may be able to convince Medicaid that not being eligible for Medicaid long-term care coverage will result in excessive difficulties. The home can also be transferred to a sibling if you co-own the home and lived there for at least one year immediately before the Medicaid applicant was admitted to the nursing home. Medicaid pays for long-term care only for those who have very low incomes or who have little income after paying for medical expenses, home care or nursing homes.
As a general rule, a home is exempt (i.e., it does not count toward the Medicaid asset limit and Medicaid does not require that it be sold to pay for long-term care) if the applicant intends to return home after receiving long-term care or if it is occupied by the applicant, the applicant's spouse, or a dependent family member. Proper planning can help you qualify for Medicaid without draining your life savings, ensuring your financial security and that of your family. The result is the number of months that an older person is excluded from receiving Medicaid payments for long-term care. In some cases, even though the home was not an accounting asset to meet Medicaid requirements, Medicaid may impose a tax on the home and attempt to recover the costs of selling the home after the death of the nursing home resident.
Knowing what Medicaid covers and if you qualify is crucial when your health changes and you need to stay in a nursing home or receive care at home.
