Long-term nursing care or assisted living does not come cheap. Fortunately, Medicaid benefits can help defray some of the costs. Unfortunately, the income restrictions needed to qualify for Medicaid are strict. Most people are surprised to find that they do not qualify for assistance. The good news is there are steps you can take to help you or a loved one get the benefits they need.
Spending down
You may not consider what you might need from Medicaid until you need it. However, you will have to shed some income to qualify for assistance. This is what’s known as a “spend down.”
Of course, you can’t simply give your money away or gift your assets to a loved one. The system looks for signs of people attempting to do so and will penalize you for trying. Each state employs a “look back” period of a number of years to see if someone is quickly getting rid of assets to qualify for government assistance.
The simplest way of spending down to qualify for Medicaid is to direct your income toward medical expenses, including:
- Bills
- Assistive devices, such as eyeglasses, hearing aids and wheelchairs
- Medical transport services
- Medical-related home improvements
The problem with the spend down approach is that it can quickly exhaust your assets, leaving little, if anything, to pass on to your loved ones.
Medicaid planning
You don’t have to wait until you need help covering the cost of long-term care. Medicaid planning can be part of your estate plan long before you ever need assistance. Using trusts and other estate planning devices enables you to set aside your assets. If you need help in the future, these assets will not count against you when applying for Medicaid assistance. This can help protect your legacy while ensuring you receive the care you need. You should discuss your goals with a skilled professional.