Medicaid is an important but complicated benefit program. When facts mix with fiction, confusion creates troubling misconceptions.
Medicaid provides health services to low-income recipients. For seniors, planning for Medicaid eligibility is important to ensure necessary medical care is affordable. We work regularly with clients in New York and elsewhere to create estate and Medicaid plans to protect wealth, family, and future.
Here are some of the myths we often hear about Medicaid:
Myth: Medicare pays for long-term nursing care for all senior citizens.
Fact: Medicaid is the program that provides long-term care dollars for eligible seniors.
As a federal health care program for seniors, many people believe Medicare will eventually take care of the cost of any long-term nursing home care they may need. Medicaid is the program that assists with long-term care costs for those with low income. While Medicare supports older adults, the target group for Medicaid is those with low income of any age. While Medicare covers eligible care in a long-term care hospital and skilled nursing care, it does not cover custodial care—which is the type of care usually provided in a nursing home facility.
Medicaid is a federal program administered through the state in which you reside. For seniors who are eligible, Medicaid pays a portion of the costs of long-term custodial care, in addition to other services.
Myth: You have to be impoverished to qualify for Medicaid.
Fact: Medicaid has strict income and asset requirements for eligibility, but recipients are allowed exempt assets along with some income.
The cost of long-term nursing home care for an individual, spouse, or couple can be excessive. Even those who have worked and saved for retirement can quickly see their financial picture deteriorate when nursing home care for one person can reach $100,000 per year. Medicaid is a program for those with low income, but it is also intended to prevent families caring for their elders or loved ones from becoming impoverished.
Medicaid planning is a legal tool that responds to your need to obtain Medicaid benefits in the future without becoming destitute. Effective planning limits your vulnerability to poverty from trying to personally pay for nursing home care, and to deter claims from the Department of Social Services trying to later recoup Medicaid costs.
Myth: When I turn 65 my health and long-term care is free, why should I worry?
Fact: Medicaid planning should be carried out well ahead of when it is needed.
Medicaid planning is a strategic and legal solution to the high cost of nursing home care. Planning for Medicaid eligibility requires knowledge of how the program works and the ways and means that you can spend down or transfer your assets to qualify for Medicaid without completely disposing of the estate you built for your family.
Many people at all income levels resist creating estate plans, advanced medical directives, and Medicaid plans. When you turn 65 or become disabled, the complexities of senior care can quickly exhaust you, your family, and your wealth.
When you apply for Medicaid, your finances in the previous three to five years will be reviewed for transfers of assets and value. Serious penalties for poor or no Medicaid planning include being ineligible for Medicaid even when your finances may be otherwise depleted.
Medicaid planning lets you make decisions and important plans for the future. When you have questions about your estate plan, get knowledgeable legal advice.
Talk to experienced estate administration and elder law attorneys
Serving New York, Florida, and New Jersey, the legal team at Lissner & Lissner LLP has more than 65 years of experience with estate planning, trusts, Medicaid planning, elder law, and restitution claims for victims of Nazi persecution and their heirs. Call (212) 307-1499 or contact us today.
The laws are changing learn more about the NY Medicaid home care law changes.