Medicaid planning should be included as a part of any good estate plan. Medicaid is a joint state and federal program that provides, in part, long-term care assistance for those who qualify. Because no one knows when they may need to live in a nursing home or use some form of long-term care, it’s important to speak to your estate planning lawyer so you can be sure a Medicaid plan is part of your general estate plan.
Issue 1: Money
If you spent a lifetime saving money and building a safe financial base, you may find that your assets begin dwindling soon after you enter an extended care facility. The costs of these facilities can be extreme, ranging from between $40,000 per year to $100,000 or more. With a Medicaid plan, you can better protect your assets and have more to leave to your family.
Issue 2: Time
Federal guidelines require that all people applying for Medicaid must meet specific criteria. One of these criteria is a five-year “look back” time period in which you must meet Medicaid asset guidelines. If, during that five-year period, you owned more assets than is allowable under the program, you will not be eligible for Medicaid and will have to pay for extended care payments out of your own pocket. This is why it is best to begin planning now instead of waiting until it’s too late.