With 2020 now receding from view and an end to the Covid-19 pandemic (hopefully) in sight, that sigh of relief so many of us need is finally on the horizon. The New Year brings promise of better times and yet it would be foolish to forget the lessons of the last twelve months. Chief among these is that health cannot be taken for granted and having a plan to ensure access to care is essential. For millions nation-wide, this means organizing assets in order to qualify for Medicaid. After all, despite common misconception, Medicaid is the best way for many folks to gain the long-term care coverage they need.
Five Frequent Medicaid Myths
Only Low-Income Adults Qualify This is both the most common and most deeply-flawed misunderstanding on this list. First, nearly half(49.7%) of the 76 million Americans receiving Medicaid are children (which is part of why planning is essential for people of any age) and second, many millions of middle-income individuals may qualify with proper foresight.
Gaining Coverage Means Hiding Your Assets Not only is this notion mistaken, it is unethical. An experienced (and honest) attorney can walk you through such common practices as spousal income and asset transfers, annuities, Medicaid asset protection trusts, and qualified income trusts (to name just a few legal instruments). All of these both work to preserve your assets and are reported directly to Medicaid through the application process.
Medicaid Means You (or Your Parents) Will Lose Their Home This misconception is related to the above but because of its prevalence (and frightening nature) it deserves individual mention. Contrary to popular belief, Medicaid rules, in fact, aim to preserve the family home. What’s more, a well-organized plan can prevent the home from being lost in what is referred to as estate recovery when the person receiving benefits dies. While too much to get into here, an experienced attorney can walk you through all of the details.
Medicaid Only Covers Nursing Homes It is true that traditionally Medicaid has mostly paid for nursing home care costs and yet (because nobody wants to be in a nursing home) some states, including Texas, offer home and community-based services (HCBS) programs. These programs allow beneficiaries to receive care in their own home or community rather than in an isolated setting and strive to make lifestyle decisions in consultation with each individual’s unique needs.
It Is Too Late to Gain Coverage Regardless of your age, financial well-being, or medical history, it is never too late (or too early!) to initiate long-term care planning. While it is true that Medicaid employs a five-year look-back period when assessing an applicant’s financial eligibility, you may still gain access and retain significant assets with proper planning even if you need care now.
According to government data, a person turning 65 today has an almost 70% chance of needing some type of long-term care in their remaining years. Such care comes at an overwhelming cost and yet this need not be a burden if you have a plan in place. The simple act of getting started on building such a plan provides immense relief and if there’s one thing most people in the US need right now, it’s just that: relief.
The holidays are often called the most wonderful time of the year, especially for aging parents. For many families who live far apart, they are also a time when adult children and grandchildren travel to visit aging parents. Even if you are in regular contact by phone and email, it can be tough to recognize signs of aging that require further attention until you are with your loved ones in person. Do you know what to look for during holiday visits to aging parents?
Let us talk about some of the signs that it may be time to look into getting your aging parent some day to day assistance, or to begin exploring options for long-term care.
The first thing to look for in your aging parents is forgetfulness. Forgetfulness is often one of the first signs to watch for. It is normal for memory to change over time. If your parents, however, are forgetting routine and long-term information, such as their street address or how to get to the grocery store, this could be a sign of the onset of Alzheimer’s or another form of dementia.
Decrease in socialization can also be a red flag in aging parents. If your normally active, social parent is spending a lot less time out of the house, this may be cause for concern, especially if he or she is now living alone after being widowed and is not getting social interaction without a spouse in the house. You can help by looking into local activities at a senior center, house of worship, or the library.
Driving issues are also things to watch for. Unfortunately, your parents probably taught you to drive, and you may be the person who has to take away their keys. If vision and spatial issues become too much and impair their ability to drive safely, it is probably time to sit down and talk to your parents about alternatives.
Additionally, be mindful of cleanliness. If your parents’ home has unexpected piles of junk mail and newspapers suddenly stacking up in the corners, it may be time to talk about getting them some help to organize and discard. If there is a true cleanliness issue, however, with food not being disposed of properly or mold accumulation, it can also be a sign of dementia.
Our office remains committed to serving the elderly and their loved ones. For legal help and support concerning elder law issues, please reach out to us to schedule an appointment.
Medical emergencies can strike without warning. Martin’s family learned that when he suffered a major stroke and landed in the emergency room. He needed skilled, 24/7 nursing care. Unfortunately, he had never done any Medicaid planning or even wondered, “Do I qualify for Medicaid.” His family had to scramble to find ways to pay for his care until his Medicaid application was processed. Don’t be like Martin. As you consider whether you might qualify for Medicaid for the Elderly & Disabled or Institutional Medicaid, think about the following questions.
Do I have a physical or mental condition that meets Medicaid requirements?
To receive Medicaid for Institutional Care, you must be in the hospital, a nursing home, or an ICF-IID facility. Medicaid usually needs to see a doctor’s diagnosis for this type of care for it to be covered.
To receive Home and Community-Based Waivers, you must be “elderly, disabled, homebound, mentally disabled, or have certain medical diagnoses…”
As Medicaid caseworkers review your application, they will review your medical records to make sure you meet the medical requirements for the appropriate program.
Do I meet residency requirements?
Since Medicaid is a joint federal-state program, each state has some flexibility in how it manages its own Medicaid program.
To receive Alabama Medicaid benefits, you must be a resident of Alabama. Also, you must be a U.S. citizen or a qualified non-citizen.
Do you meet Medicaid’s income and resource limits?
These limits vary from program to program. However, the income and resource limits for E&D and Institutional Care are:
• Income limit: $2,030 per month • Resource limit: $2,000 as of the first day of each month.
There are special rules for married individuals. When deciding whether you qualify for Medicaid or not, talk to an experienced Alabama Medicaid lawyer to make sure.
Answer the Question, “Do I Qualify for Medicaid?”
Discuss your circumstances with an experienced Alabama Medicaid lawyer.
Contact us at 256-472-1900 for a free consultation. The attorneys at Miller Estate and Elder Law know how to help you with Medicaid planning and with estate recovery concerns. Miller Estate and Elder Law is located at 818 Leighton Avenue in Anniston, but we serve clients in Gadsden, Hoover, Talladega, Vestavia Hills, and surrounding areas.
Also, receive a free download of Medicaid Planning in Alabama: What You Need to Know by completing the brief form below:
Sometimes the more answers we get, the more questions we have. The same may be true when it comes to Medicaid. Someone who needs help paying for medical care or a nursing home may be relieved to learn that Medicaid offers this type of benefits. Then they learn that the application process is difficult. You have to qualify for Medicaid benefits, and some of the requirements are hard to understand. For example, you may want to learn more about the Medicaid income limit. That’s what we will explore in this blog.
First, what are the basic Medicaid qualifications?
Medicaid offers several programs, each with its own qualifications. For example, Medicaid for Pregnant Women and Medicaid in the Nursing Home target very different groups. That said, Medicaid generally is intended for people with low incomes. Applicants who exceed the Medicaid income limit usually will not qualify for benefits.
What is the current Medicaid income limit?
It varies. The income limit for people who qualify through Supplemental Security Income (SSI) is $791 per month / $1,177 for couples.
However, the Medicaid in the Nursing Home program income limit is $2,313 per month for one person. This limit also applies to:
Elderly and Disabled Waiver,
Independent Living Waiver,
Persons with Intellectual Disabilities Waiver, and
Technology-Assisted Waiver for Adults.
Effective February 2019, Medicaid uses the Modified Adjusted Gross Income (MAGI) method of determining income for some programs. For example, the Plan First and Pregnant Women & Children programs calculate income after deductions based on family size:
Family of 1 = $1,520
Family of 2 = $2,058
Family of 3 = $2,596
Family of 4 = $3,133
You may be wondering if Medicaid counts all your income when determining if you are qualified for benefits.
What does Medicaid consider to be income?
Generally, Medicaid counts all the following income toward your Medicaid income limit:
Federal taxable wages;
Self-employment income;
Unemployment compensation;
Social Security benefits, including Social Security Disability Income (SSDI);
Retirement or pension income;
Alimony or spousal support for divorces finalized before January 1, 2019;
Capital gains;
Investment income;
Rental and royalty income; and
Untaxed foreign income.
Income that is not counted toward the limit includes:
Supplemental Security Income (SSI);
Veterans’ disability payments,
Workers’ Compensation,
Proceeds from loans, including student loans; and
Child support.
I’m just over Medicaid income limit. Is there anything I can do?
Possibly. Just talk to an experienced Alabama Medicaid lawyer about Medicaid planning and spend-down strategies.
The attorneys at Miller Estate and Elder Law assist their clients with Medicaid and incapacity planning, as well as general estate planning. Contact Bill Miller at 256-251-2137 to schedule an appointment. Though our office is now located at 818 Leighton Avenue in Anniston, we serve clients in Gadsden, Hoover, Talladega, Vestavia Hills, and surrounding areas.
Also, download a copy of our free e-book, Medicaid Planning in Alabama: What You Need to Know, by clicking here.
Benefit programs like Medicaid often include strict requirements and rules. To qualify for Medicaid, for example, an applicant must show a financial need by staying below Medicaid’s income and resource limits. However, some people need Medicaid benefits but exceed the amounts Medicaid allows. In this article, we will look at those limits, and, more importantly, how to spend-down your assets and monthly income to meet them.
Medicaid Limits on Income and Resources
A nursing home resident typically can possess no more than $2,000 in resources as of the first day of the month.
However, Medicaid does not count all of your assets and income. Some resources might be considered as countable, including cash, real estate, and one automobile per household. The status of some assets may change in certain situations. For example, real estate held as a life estate or that is on the market may not be counted.
It’s to your benefit to consult with an experienced attorney before applying for Medicaid or attempting any sort of spend-down activities.
Planning a Spend-Down
After learning you may not qualify for Medicaid because of income and asset limits, you may want to plan a spend-down of your assets. But how exactly do you go about doing this? Here are some important considerations:
Where are you living?
Are you married or single?
What is the source of your income?
What type of assets do you have?
The answers to these questions may make a difference in how you spend proceed. Make sure your lawyer has all the information needed to advise you about spending down your assets.
Actions That Spend-Down Your Assets and Monthly Income
After carefully assessing your resources compared to Medicaid’s requirements, you may start taking some of the following steps:
Pay your medical bills. Certain medical bills can be paid to reduce your countable cash assets. In addition to your own, you may be able to pay medical bills for your spouse and your children. You can pay past and current medical expenses, which may include transportation costs, therapists, personal care attendants, home health aides, rehabilitation programs, prescription drugs, and medical equipment ordered by a doctor.
Pay off other debts. You may be eligible to use excess income to reduce mortgage, auto loan, and credit card balances.
Sell certain assets. In some situations, countable assets may be sold to pay off medical bills and debts to reduce a recipient’s resources.
Set up a Miller Trust. Excess monthly income can be diverted to a Miller Trust to stay below Medicaid’s monthly income and resource limits. Funds in the Miller Trust can be used for eligible expenses.
Keep in mind that transferring, selling, or spending assets may result in reductions or delays in benefits.
Spend-Down Your Assets and Monthly Income Wisely
The rules are complicated. Always speak with an experienced attorney before trying any kind of spend-down strategies.
Do I Have to Wait 60 Months to Qualify for Medicaid?
One of the most frequent questions that I get as an elder law attorney when someone’s trying to apply for Medicaid to get in a nursing home, is, “Do I have to wait 60 months to Qualify for Medicaid?” And the answer is, “No.”
The Medicaid Look Back Period is Different from the Medicaid Penalty Period
60 months is simply the look-back period, or the amount of time that Medicaid looks back to see if you’ve given any assets away or if you have sold assets for less than fair market value. So, when you file the application, you have to meet the financial requirements which I’ll address in another video. But once you meet those financial requirements then Medicaid is also going to look back 60 months to see if you’ve given away any assets during that time.
If you have given away assets during the past 60 months, then they’re going to penalize you based on the amount of money that was given away. The penalty period is determined by the amount of money you gave away divided by a divisor that is put out by Medicaid. The Medicaid look back period of 60 months is the same for everyone. The penalty period is different for everyone. However, there is no Medicaid 60 month rule that says you have to wait 60 months to apply for Medicaid. Most of our clients don not wait 60 months. We even have clients who are already in a nursing home and we can help them protect some of their assets.
if you have any other questions, watch the other videos or give us a call 256 472-2172. I look forward to meeting you.
