Statistically speaking, the odds are favorable that you will spend time in a nursing home or other long-term care facility at some point in your life. The longer you live the greater your chance. By age 85 you stand a 75 percent chance of needing long-term care. That care is not cheap. Moreover, it is not covered by either Medicare or most private health insurance policies. Like most people, you may turn to Medicaid for help; however, you may be concerned about Medicaid’s eligibility requirements and how they affect your assets. Specifically, you may want to know “ Can the nursing home take my house or other important assets? ” To answer that question a better understanding of the Medicaid program as well as the “Estate Asset Recovery” program is necessary.
Medicaid is a health insurance program for low income individuals and families. Though federally funded, Medicaid is state administered. To qualify for Medicaid both your income and the value of your countable assets must fall below program guidelines. Those guidelines are very low. For example, you cannot own countable resources valued at over $999. If your assets do exceed the program limits you must “spend-down” those assets until they fall below the limit. This is where much of the fear regarding Medicaid comes from – the loss of assets due to the “spend-down” requirement. Although neither Medicaid nor the nursing home can actually take your home or any other asset, you could be forced to use hard-earned assets to cover long-term care expenses before Medicaid will help.
The other concern is that assets are at risk from the “Estate Asset Recovery” program. This is a federal program that attempts to “recovery” funds spent on a Medicaid recipient by pursuing a claim against the recipient’s estate upon death. While the Estate Asset Recovery program does allow Medicaid to file a claim against your estate, there are limits to what the program can take from your estate after your death. Your home, for example, is usually exempt if a spouse or other dependents are living in the home at the time of your death.
The key to protecting your estate assets is to include Medicaid planning in your overall estate plan as early on as possible. The earlier you start, the more assets you will be able to protect while still ensuring that you will qualify for Medicaid when the time comes that you need long-term care. Consult with your Missouri estate planning attorney about Medicaid planning and how to incorporate it into your overall estate plan.