Medicaid is a program that is jointly funded between the federal government and individual states. Medicaid pays for medical care for certain low-income individuals. One of the most important benefits of Medicaid for many seniors is the nursing home payment – Medicaid will pay for long-term care in a nursing home.
However, in order to qualify for Medicaid, you must meet strict income and asset requirements. There is a limit to how much income you may receive each month and still qualify for Medicaid, which depends on the number of family members who live with you. You must also have beneath a certain level of assets or resources, which includes cash, bank accounts, life insurance policies, bonds, stocks, mutual funds, real estate, and other assets.
When family members are looking at nursing homes for a loved one and the expense, and realize that Medicaid will pay for the nursing home if the individual’s assets are beneath a certain amount, they often think about asking the individual to give away assets in order to qualify. However, Medicaid imposes a five-year “look back” period. This means that when determining whether an individual qualifies for Medicaid, officials will look to see if any assets have been given away or sold for less than fair market value during the five years preceding the application for Medicaid. If assets have been given away, a penalty period may be imposed.
Medicaid planning is a very technical and complex area of law, and if done improperly an individual may be forced to spend thousands of dollars unnecessarily on nursing home care that Medicaid otherwise would have covered. There are many legal options in structuring your assets and/or income in a way so that Medicaid will legally pay for nursing home care.
If you’re in New York, and are facing the expense of a nursing home for a loved one, call the the New York Elder Law Attorneys at Friedman & Ranzenhofer at 716-542-5444. Our attorneys have significant experience in elder law planning and can help guide you through the Medicaid process.