Throughout your working years, you may have been fortunate enough to enjoy employer-sponsored health insurance. As you near retirement age, however, you may find that your employer-sponsored insurance terminates, and Medicare takes over covering most of your health care expenses. One thing Medicare will not cover though is long-term care except under very limited circumstances. If you need long-term care (LTC) at some point, you may find yourself turning to Medicaid to cover the high cost of that care. Qualifying for Medicaid often requires planning ahead to ensure that your assets are not over the eligibility limit. Once you qualify though, can you lose your eligibility down the road? The Glastonbury Medicaid attorneys at Nirenstein, Horowitz & Associates, P.C. explain how Medicaid eligibility works and whether you can lose your eligibility after you are initially approved.
Medicaid is a healthcare program that is funded by the federal government, although the individual states have the option to supplement that funding. In addition, the individual states administer the Medicaid program which is why you will find some differences in the eligibility guidelines and benefits offered from one state to the next. Because Medicaid is a “needs based” program, however, every state uses income and asset limits when determining eligibility. You must also prove residency and citizenship as well as disability if you are applying for disability based Medicaid.
The income limits are tied to the Federal Poverty Level (FPL) which is subject to change each year. Moreover, almost every state has multiple Medicaid programs that may utilize different income caps. As a very general rule of thumb, however, if you make less than 200 percent of the FPL and you are pregnant, elderly, disabled, or you are a parent/caretaker or a child, you will likely meet the income guidelines for one of the state’s Medicaid programs. For 2018, the FPL for a family of two was $16,460. The “countable resources” limit can also vary; however, it is typically $2,000 for an individual and $3,000 for a married couple. This means that if you have non-exempt assets valued at more than $2,000 you will not be eligible for Medicaid. Fortunately, some assets are exempt from consideration when determining eligibility. In Connecticut, common exempt assets when applying for Medicaid as a senior include:
- One home up to an equity limit of $858,000 IF you are planning to return to the home OR a spouse, a child under 21, or a disabled person resides in it.
- One vehicle
- Burial plots
- Trusts for disabled individuals under 65, which qualify under 42 USC 1396p(d)(4)(A)
- Annuities that meet certain criteria
- Transfers of assets to disabled children and to “caregiver children” who meet certain criteria, do not create a penalty.
Can My Medicaid Eligibility Change?
Once you have made it through the arduous process of getting your application for Medicaid approved, can they take your benefits away in the future? The simple answer is “yes.” Each year you must re-apply and re-qualify for Medicaid. The application process itself is typically less cumbersome after your initial approval; however, both your income and your countable resources must meet the eligibility requirements on a yearly basis. Consequently, it is possible to lose your Medicaid eligibility after it is initially approved.
For seniors, one of the most common ways to lose Medicaid benefits is through an inheritance. For instance, if one of your parents passes away, leaving you a vacation home as part of your inheritance, the value of the home would certainly put you over the countable resources limit.
The best way to prevent the loss of your Medicaid eligibility after you become eligible through comprehensive estate planning that includes a Medicaid planning component. This is also the best way to ensure that you are approved the first time you apply for Medicaid as a senior.
Contact Glastonbury Medicaid Attorneys
For more information, please download our FREE estate planning worksheet. If you have additional questions or concerns about Medicaid eligibility or Medicaid planning, contact the experienced Glastonbury Medicaid attorneys at Nirenstein, Horowitz & Associates, P.C. by calling (860) 548-1000 to schedule an appointment.