It can be hard to envision a time when you will not be able to take care of all of your own day-to-day needs, but the reality is that most senior citizens will eventually need living assistance. The figure is 70 percent according to the United States Department of Health and Human Services.
Most seniors qualify for Medicare when they reach the age of 65, but Medicare does not pay for long-term care. There are those who can rely on family members and friends for assistance, but a significant percentage of elders ultimately reside in assisted living communities and nursing homes.
These facilities are quite expensive, and long-term care costs are especially high here in Connecticut, where we practice law. It can easily cost you well in excess of $100,000 per year to reside in a nursing home, and people often require multiple years of care.
This is where nursing home asset protection comes in. If you take the right steps in advance, you may be able to become eligible for the Medicaid program without losing a great deal in the process. This government health insurance program does pay for long-term care if you can obtain eligibility.
You are probably aware of the fact that Medicaid is a need-based program. The limit on countable assets is just $2000, but some things that you own do not count, including your home (there is an equity limit of $828,000 in Connecticut in 2015).
One vehicle that is used as a primary source of transportation is not counted, your wedding and engagement rings are not countable assets, and your home furnishings and personal belongings would not be counted.
To qualify for Medicaid, you could engage in a process called a Medicaid spend down. You could literally spend liberally over an extended period of time, but most people will give assets to their loved ones with future Medicaid eligibility in mind.
This is often done; in fact, most of the nursing home care that is being received by seniors in the United states is paid for by Medicaid, and most of these people retired with resources.
You have to be aware of the five-year Medicaid look-back when you are implementing a nursing home asset protection strategy. Your spend down must be completed at least five years before you apply for coverage. If you violate this look-back rule, your eligibility is delayed.
Learn More About Nursing Home Asset Protection
If you would like to obtain more detailed information about nursing home asset protection, download our special report. This in-depth report is free, and you can click the following link to access your copy: Free Medicaid Planning Report.