Medicaid planning is a useful tool for preserving your estate for your family while still qualifying for federal assistance to pay for nursing home care for yourself or your spouse. It is also a complex process. Without meaning to, you can easily make a mistake that takes away your chances of qualifying for Medicaid assistance.
Here are five common Medicaid planning errors people in Brevard County sometimes make:
- Selling their home. In Florida, your homestead is exempt from the assets that Medicaid counts when judging if someone qualifies. Selling it converts the home into cash, which Medicaid definitely counts. Similarly, putting ownership of the homestead into trust also converts it from an uncountable asset into a countable one.
- Making large gifts, or at least doing so within the Medicaid program’s five-year lookback period. Medicaid could react by delaying your qualification for years. In the meantime, you might have to find a way to pay for long-term care yourself.
- Improper estate planning. Your will, trust and other estate planning tools should be crafted with Medicaid planning in mind. Otherwise, your estate plan could cause your Medicaid planning to backfire.
- Impoverishing yourself. Some couples think they have to get rid of virtually all their retirement savings and other assets to qualify. But there are exemptions for spouses who are still living at home that help couples retain more of their assets.
- Misusing a Medicaid planning trust. The qualified income trust, also known as a QIT or Miller Trust, helps shield income from the Medicaid planning process. But mistakes, like putting assets other than income into the trust, can defeat the purpose.
You can best avoid these types of planning errors by working with an experienced Medicaid planning attorney.