Most people are at least vaguely familiar with Medicaid, the federal program that provides healthcare benefits to low-income individuals and families. Unless you have ever needed the benefits offered by Medicaid, however, you probably don’t know as much as you need to know about the program. Like a significant percentage of seniors, you may find that you, or a spouse, will need to rely on the benefits offered by Medicaid at some point during your “Golden Years” if you end up in long-term care (LTC). The Medicaid rules are confusing and the application procedures can be difficult to navigate which has led to a considerable amount of inaccurate information about the program being disseminated to the general public. Because we believe it is important for you to have accurate and helpful information about the program, the Harrison Medicaid attorneys at the Law Offices of Kobrick & Moccia uncover the top five Medicaid myths.
- I have Medicare so I won’t need Medicaid. This common misconception frequently leads to disastrous results when it causes the failure to include Medicaid planning in your estate plan. Once you reach retirement age you will automatically be enrolled in Medicare if you, or a spouse, paid into Medicare over the course of your working years. While Medicare will cover many of your basic healthcare expenses, it will not cover LTC expenses. For over half of all seniors currently in LTC, Medicaid is the only help they get with their LTC bill. You may never need LTC; however, if you do – or a spouse does – you will likely need Medicaid.
- I will lose my house if I try to qualify for Medicaid. Like many myths, this one as a kernel of truth in it. While most states exempt a primary residence from an applicant’s “countable resources” when determining eligibility, many other assets do count. If the value of your countable resources is above the threshold your application will be denied. To qualify, you will have to “spend-down” your excess assets.
- My spouse will be left with nothing if I need to qualify for Medicaid. Although it has been decades since the Medicaid Spousal Impoverishment Rules were enacted, this myth continues. Prior to changes in the Medicaid rules the spouse that remained in the community (the “community spouse”) was often left with virtually no income and few, if any, resources. The Spousal Impoverishment Rules were created to prevent this from happening.
- I can just transfer my assets to my grown children if I ever need to qualify for Medicaid. Once upon a time, this was possible; however, Medicaid changed the transfer rules to prevent exactly this. Medicaid now uses a five-year “look-back” rule that prevents asset transfers in anticipation of the need to qualify for benefits. Your finances will be reviewed and any transfers made for less than fair market value will likely be discounted and the value of the asset will be imputed back into your estate for the purpose of determining your eligibility for benefits.
- If I qualify, Medicaid will cover all my LTC expenses. Although Medicaid will cover a significant portion of your LTC expenses if you are approved for benefits, do not count it paying all of your expenses. There are a number of factors that will impact what Medicaid will cover, how much it covers, and for how long. This is yet another reason why consulting with an experienced Medicaid attorney now is recommended. By doing so, you can plan accordingly and ensure that your assets are protected.
Contact Medicaid Attorneys
For more information, please download our FREE estate planning worksheet. If you have questions or concerns relating to Medicaid planning in the State of New York, contact the Harrison Medicaid attorneys at the Law Offices of Kobrick & Moccia by calling 800-295-1917 to schedule your appointment.