Will Assets in My Living Trust Be Counted By Medicaid?

Will Assets in My Living Trust Be Counted By Medicaid? The Medicaid program will pay for long-term care. You may hear this statement and shrug your shoulders, because you will never qualify for Medicaid, and you will qualify for Medicare by the time you require living assistance.

This reaction makes sense on the surface, but when you dig into the facts, you will see a different picture. It can certainly seem as though the Medicare program should be set up to pay for nursing home care. However, whether it makes sense or not, the program does not pay for living assistance. Nursing home and assisted living community care are considered to be custodial care, and Medicare will not pick up the tab for this type of care.

Paying for your long-term care out-of-pocket if you ever need it is not something that is easily done, because the national average charge for a year in a nursing home exceeds $90,000 at the time of this writing. People often receive multiple years of care, and 10 percent of people in nursing homes are in the facilities for at least five years.

These current numbers are disturbing enough, but long-term care costs have been rising steadily year-by-year. If you need long-term care in 20 or 30 years, long-term care costs will probably be considerably higher.

Qualifying for Medicaid

Now that you can see why you may want to qualify for Medicaid as a senior citizen, you may wonder how you go about it.  Since there is a $2000 limit on countable assets, people often give assets to their loved ones before they apply. To do this effectively, you have to act in advance, because there is a five-year look-back. You are penalized, and your eligibility is delayed if you give gifts within five years of submitting your application for Medicaid.

If you have diligently put an estate plan together through the creation of a revocable living trust, you may assume that assets in the trust would not be counted by the Medicaid program. This is not the case, because you retain control of assets that you convey into a revocable living trust. You are probably acting as the trustee, and you have the right of revocation, so you can dissolve the trust and walk away with the assets at any time.

Though a living trust is not going to be a Medicaid planning solution, an irrevocable Medicaid trust could be utilized to get assets out of your own name so that you can qualify for Medicaid.

Devise a Nursing Home Asset Protection Strategy

If you are ready to devise a nursing home asset protection strategy that will keep your resources in your family, our firm would be glad to help. We offer no obligation case evaluations, and you can contact us through the following link to set up an appointment: Dallas TX Medicaid Planning.