The Medicaid program is relevant to working people who are planning ahead for the future because Medicare will not pay for long-term care.
Long-term care, which is the type of care that you would receive in a nursing home or assisted living community, is considered to be custodial care. Custodial care is not covered by Medicare. The program will cover up to 100 days of convalescent care after surgery and 3 days in the hospital, but that’s the extent of it.
Long-term care expenses are a source of concern within the elder law community. It is not possible for many people to absorb these costs out-of-pocket. If you need long-term care and you cannot pay for it, where do you turn? The answer for many is Medicaid.
Medicaid actually pays for most of the long-term care that is received by seniors in the United States.
Because Medicaid is a need-based program, you can’t qualify if you are in possession of a significant store of financial resources. One way to divest yourself of resources would be to pay for long-term care out-of-pocket. Once you are essentially broke, you could then qualify for Medicaid to pay for the rest of the care that you need.
This is not a very appealing prospect to most people. An alternative would be to plan ahead in advance with future Medicaid eligibility in mind. It is possible to set aside resources for the well-being of your loved ones in advance of applying for Medicaid in a measured and informed manner.
Medicaid Trust in Cincinnati
There are Revocable Trusts, and Irrevocable Trusts. If you create a Revocable Trust you retain incidents of ownership because you can revoke the Trust. On the other hand, you are surrendering assets that you convey into an Irrevocable Trust.
To prepare for future Medicaid eligibility you could potentially create and fund an Irrevocable Trust for the benefit of loved ones.
However, there are some disadvantages of a Medicaid Trust in Cincinnati.
There is a five year look back. You must fund the Trust at least five years before applying for Medicaid, or you will be penalized and your eligibility will be delayed.
To address the five year look back you must divest yourself of resources long before you intend to apply for Medicaid. You may be prepared, but you may divest yourself of resources and never need long-term care.
Medicaid Planning Consultation
Addressing long-term care costs via the implementation Medicaid planning techniques can be complicated. You probably have many questions, and this is understandable.
If you would like to discuss the matter with a licensed Cincinnati elder law attorney, we invite you to contact our firm to schedule a consultation. We will explain things to you, answer your questions, and make recommendations based on your unique personal situation.