Medicaid Planning: Did I Wait Too Long?
You may feel as though the Medicaid program is irrelevant to you. After all, Medicaid is a government health insurance program for people with virtually no financial resources, right?
Indeed, Medicaid is a need-based government health insurance program. It is jointly administered by the state government along with the federal government.
Most seniors will qualify for Medicare coverage. This is another government health insurance program, and it provides coverage for senior citizens who have worked throughout their lives.
You obtain Medicare coverage through the accumulation of retirement credits. You earn these credits while you are paying taxes. A portion of the FICA deduction goes toward future Medicare coverage.
Though Medicare will be of great assistance when you become eligible for coverage, there is a big gap: Medicare does not pay for long-term care. The majority of senior citizens will eventually need help with their activities of daily living, so this is a very big deal, because long-term care is expensive.
Medicaid will pay for long-term care, and this is why it is quite relevant to a significant percentage of the senior population. In fact, Medicaid pays for most of the nursing home care that is received by seniors in the United States.
People who want to prepare for future long-term care costs often aim toward Medicaid eligibility. Because it is a need-based program, there are income and asset limits. To stay within these limits, you could give assets to your loved ones, essentially giving them their inheritances in advance.
However, you cannot find out that you need long-term care and give away your assets later that day under the assumption that Medicaid will pay for the care. There is a 60 month look-back period. You are penalized, and your eligibility is delayed if you do not complete your divestitures at least five years before you apply for Medicaid.
If you hold on to your assets until you find out that you need long-term care, you will have waited too long. The period of ineligibility would be tied to the amount of the divestitures as they compare to the cost of long-term care in the state of Texas.
For example, if the average cost for a year in a nursing home was $70,000, and you gave away $210,000, your eligibility would be delayed by three years, because you gave away enough to pay for three years of nursing home care.
You should certainly gain an understanding of the Medicaid program if you want to be prepared for the eventualities of aging. Our firm is offering a special report on Medicaid planning, and the report is free to our readers at the present time.
To access the report, click this link and follow the simple instructions: Dallas TX Medicaid Planning.