Most people don’t want to think about a time when they may need a nursing home or another kind of long-term care to get by, but it may become more necessary to plan for this time as the average American’s lifespan increases.
Whether you’re trying to plan for yourself or an aging loved one, you probably know long-term care of any kind is no small expense. Nursing homes can cost about $100,000 per year for a private room in Florida, and about half as much for similar accommodation in an assisted living facility.
Neither of these arrangements is exceptionally affordable for many aging Americans, but fortunately, Medicaid can cover about 60 percent of all long-term care spending. This level of financial assistance, provided jointly by the state and federal governments, can make it more possible for aging Americans with modest savings (or who want to make sure they can leave behind inheritances) to afford the care they need.
So, when should you apply for Medicaid?
Beginning Planning 5 Years in Advance
You should begin planning to apply for Medicaid about five years in advance of doing so. Because Medicaid eligibility will require you to spend down your estate or place it in a Medicaid-approved trust, you may only be allowed to have a few thousand dollars to your name to qualify.
Why five years? That really comes down the Medicaid’s five-year “look-back” period. When you apply for Medicaid, the program will take a look at 60 months prior to your application and see if any assets were transferred for less than their fair market value. If any are found, a penalty period may be applied against your application that can extend how long you remain ineligible for Medicaid coverage.
If you have an illness or condition such as the following, consider planning even sooner:
- Renal failure
- Certain cancers
These conditions may necessitate an extended nursing home stay, which is why planning for them more than five years out.
Marriage May Complicate Eligibility
When one spouse requires Medicaid assistance, marriage can make it difficult to successfully apply for the program. To qualify, the Maximum Community Spouse Resource allowance permits only about $128,000 in non-exempt assets.
That means if a couple’s home, bank accounts, and other assets shared during marriage exceed this amount, they must spend down until the applying spouse’s share of community property is less than $2,000 – leaving the other spouse with about $63,000.
An Attorney Can Help
Because applying for Medicaid can be a complicated legal and financial procedure, many people choose to hire an attorney to guide them through the process. We at The Dorcey Law Firm known that Medicaid is difficult for anyone to try to navigate on their own – that’s why we strive to provide our clients with the legal advice and services they need to understand their options and take action.
If you’re concerned about spending down your estate and want to preserve your wealth while still qualifying for Medicaid, there may be options available to you. The Dorcey Law Firm’s attorneys will carefully consider your situation and goals to provide realistic solutions that may help you achieve the best possible outcomes.
Schedule a consultation with us today to learn more about what The Dorcey Law Firm can do for you. During this meeting, you’ll have an opportunity to discuss with an attorney your needs and find out how we may be able to help.
For more information, get in touch by contacting us online or calling (239) 309-2870.