Many adults go through their entire working years without ever needing to rely on Medicaid to cover healthcare expenses, only to find that they must turn to Medicaid as a senior. If you are among them, you may mistakenly believe some of the myths and misconceptions about the program. To help clear those up, a Hartford Medicaid planning attorney at Nirenstein, Horowitz & Associates, P.C. explains the top five Medicaid myths.
- Medicare will cover my health care expenses so I don’t need to qualify for Medicaid. Once you reach retirement age you will automatically be enrolled in Medicare if you, or a spouse, paid into Medicare over the course of your working years. While Medicare will cover many of your basic healthcare expenses, it will not cover LTC expenses. For over half of all seniors currently in LTC, Medicaid is the only help they get with their LTC bill. You may never need LTC; however, if you do – or a spouse does – you will likely need Medicaid unless you can afford to pay for that care out of pocket.
- I won’t qualify for Medicaid because I won my house. This Medicaid myth one has some basis in fact; however, it is frequently misunderstood. Most states exempt a primary residence from an applicant’s “countable resources” when determining eligibility. If the value of your countable resources is above the threshold (just $2,000 for an individual in most states) your application for Medicaid will be denied. To qualify, you will have to “spend-down” your excess assets. So, while your home is probably safe, you could lose other assets if you need Medicaid in the future and you failed to plan for that possibility. In addition, the Medicaid Estate Recovery Program (MERP) can file a claim against your estate after your death to seek reimbursement for expenses paid on your behalf while you were alive. In some cases, your house could be at risk after you are gone. Once again though, careful planning can prevent this threat from materializing as well.
- If I do need to rely on Medicaid, my spouse could be left at home with nothing. Although it has been decades since the Medicaid Spousal Impoverishment Rules were enacted, this myth continues. Prior to changes in the federal Medicaid rules, the spouse that remained in the home (the “community spouse”) was frequently left destitute because of the “countable resources” and “spend-down” rules. The Spousal Impoverishment Rules, however, changed that. A community spouse is now entitled to retain half of a couple’s countable resources as well as all of his/her own income and even some of the institutionalized spouse’s income if it is necessary to maintain a basic standard of living.
- If I end up needing to qualify for Medicaid I can just transfer my valuable assets to my children. You may have friends or relatives who have told you not to worry because they just transferred their valuable assets to children when they realized the need to qualify for Medicaid. Not all that long ago that was possible; however, Medicaid now uses a five-year “look-back” rule that prevents asset transfers in anticipation of the need to qualify for benefits. Your finances will be reviewed and any transfers made for less than fair market value will likely be discounted and the value of the asset will be imputed back into you estate for the purpose of determining your eligibility for benefits. This is why it is so important to incorporate Medicaid planning into your estate plan now, hopefully long before you actually need to rely on the benefits offered by Medicaid.
- Medicaid won’t cover alternatives to nursing home care. You undoubtedly would prefer to put off the need to move into a long-term care facility. Options such as daily home health aides, community care, and assisted living are available. Moreover, many states have “waiver” programs that make it possible for Medicaid recipients to take advantage of these options.
Contact a Hartford Medicaid Planning Attorney
For more information, please join us for an upcoming FREE seminar. If you have additional questions or concerns about long-term care or Medicaid planning, contact an experienced Hartford Medicaid planning attorney at Nirenstein, Horowitz & Associates, P.C. by calling (860) 548-1000 to schedule an appointment.