Estate Planning – The Need for Medicaid Planning
The life expectancy of an American is considerably longer today than it was just a couple of generations ago. Living longer, however, often comes at a cost. Both long-term care and healthcare costs can quickly diminish a life savings without careful planning. The Medicaid program may provide a solution; however, you will need to incorporate Medicaid planning into your overall estate plan to ensure that you receive the maximum benefits from the program without putting your nest egg in jeopardy.
Why Is It Important to Qualify for Medicaid?
Neither the Medicare program nor most health insurance plans cover the cost of long-term care. The average stay in a long-term care facility is 30 months. With the average annual cost of a long-term care facility running around $75,000, the bill for a stay in a long-term care facility can quickly deplete a life savings if you are forced to pay for it out of pocket. Unlike Medicare, the Medicaid program will cover some of the costs associated with long-term care, which is why it is important to qualify for the program.
What Is Medicaid Planning?
Medicaid is a means test program, meaning that both income and resources will be considered when determining eligibility. In Oregon, the resource limit for an individual is $2,000 and for a couple is $3,000. Although certain assets, such as your home, are excluded when calculating your resources, you can easily see how a nest egg could be depleted rapidly before Medicaid will kick in and start paying for long-term care costs. Medicaid planning aims at preventing just that from happening.
Simply transferring assets out of your name when you realize you need to qualify for Medicaid will not work because the Medicaid guidelines include a “look-back” period. In essence, the look back period is a period of time prior to application during which you cannot have made any asset transfers. However, with careful pre-planning you may be able to retain control of your hard earned assets and still qualify for Medicaid when the time comes. The earlier you start planning the better; however, there are legal strategies that can be employed at the last minute.
The estate planning attorneys at Law Offices of Richard B. Schneider, LLC are familiar with the complex rules and procedures involved in Medicaid eligibility. More importantly we know how to include Medicaid planning into your estate plan so that you will be eligible for benefits when they are needed without losing your live savings. Contact us today by calling 503-241-1215 or through our online contact form so that we can help protect your assets while ensuring your future care.