Understanding Long Term Care

Medicaid does more that help those over 65 years of age and low income families with health care coverage; it also pays for an elders long term care nursing home care. For individuals who have a parent that’s nearing the age when a nursing home may be a possibility it’s important to start planning now. Medicaid is governed by federal and state laws. Both of these entities have an ineligibility period, when it comes to long term care coverage, if before applying for benefits your parent transfers assets. That’s why you should talk with an elder transfer of assets lawyer about a plan, if nursing home care is a possibility for your parent.

Long Term Care Eligibility

Like most government assistance, the eligibility for Medicaid is based on your parent’s income and asset value. If their asset value is over their eligible limit, they won’t qualify. An easy solution to this problem is to have your parent give away their assets, but there’s a law restriction on this. Since the individual states and federal government fund Medicaid, they place restrictions on transferring assets of elders for five years prior to application for long term care. It would place a financial burden on these governments if seniors simply just gave away their assets in order to become eligible for Medicaid. This 5 year period is often referred to as the “look back” period.

Transfers

All transfers aren’t prohibited by law. There are some transfers that are exempt, and some that can incur a penalty period. Talking with an elder transfer of assets lawyer can help you plan the right transfers at the right time for an easy application process. The law addresses mainly those transfers that are made at less than fair market value. What this means is that say your parent has an antique clock that’s been appraised for $15,000, they wouldn’t be permitted to sell or give it away for less than that during the look back period. If they sold it for $5,000, they would still have cash asset of $5,000 and the difference of the $10,000 would still count against their Medicaid eligibility.

This type of transfer can impede your parents Medicaid eligibility, this is not to say they would be barred but they would have a penalty period. The penalty period is dependent on each state’s regulations. This penalty period usually begins after they apply for benefits, provided they meet the other qualifications.

As mentioned earlier, there are some assets that are exempt for Medicaid purposes. These things can include their home, a car, and life insurance. An elder transfer of assets lawyer understands these exemptions and can be very crucial to implementing your parent’s long term care.

Medicaid law is complicated, and each case is unique to their facts. Hopefully, this general introduction to Medicaid application for long term nursing home care is helpful. You can find out more information and specific information to your case by talking with an elder law attorney, most provides a free case evaluation.