In a perfect world, everyone would have the insight and foresight to draft a plan now for possible nursing home cost in the future. In the reality we are, however, most individuals fail to buy long-term care insurance or at least save adequate funds to cover the expenses for long-term care, whether the stay is short or a permanent move.
As you know, long-term care is pretty expensive, and you wouldn’t want to use your hard-earned savings to pay for a nursing facility or home care. Because of this, many individuals embrace Medicaid to cover their bills.
Medicaid is only for those who are eligible
Medicaid eligibility in New York requires applicants to have limited assets. So what does it means for those who have thousands of dollars’ worth of assets? Does it mean they would have to jettison their assets to qualify for Medicaid? No. What these individual have to do is protect their assets and with Medicaid Assets Protection Trust, doing that shouldn’t be hard. However, before you consider placing your assets in Medicaid Asset protection Trust, it is important that you know what it is and how it works.
What is Medicaid?
Medicaid is a government-funded program that provides health-care coverage to individuals who qualify. Each state has its own way of operating its Medicaid program. However, the federal government has rules that all states are to adhere to. The federal government also provides a portion of funding for Medicaid while it is up to the states to provide the rest.
According to federal laws, states create and operate their own Medicaid program to best serve their residence who are eligible. States may decide to tweak the requirement terms by providing Medicaid services to a larger group of individuals probably those with disabilities, the homeless, pregnant women, et al. Medicaid provides health care coverage to those who qualify, according to income and the value of their assets.
What is Medicaid Protection Trust?
A Medicaid Asset Protection Trust or a MAPT is a trust created to protect assets from being considered for Medicaid eligibility. A Medicaid asset protection trust allows an individual to be eligible for long term care benefits from Medicaid, while securing assets from being used if long-term care is required.
How does it work?
A Medicaid Asset protection Trust allows an individual to qualify for long-term care benefits from Medicaid, while protecting assets from being used to finance long-term care when needed. To qualify for this government-funded program, household assets must be below a certain threshold. Rules regarding asset levels are stringent. In addition, there is a five year look back period to determine if an individual is eligible for this program.
Provided the trust is set up and assets are transferred five years prior the donor applies for Medicaid long-term care benefits, Medicaid will not sanction the donor for transferring the assets, and the existence of the trust will not affect his or her Medicaid eligibility.
Assets placed in a MAPT are not deemed countable for Medicaid. But, if Medicaid is required prior the expiration of the five-year look-back period, a disqualification penalty period can be applied before you are able to enjoy the Medicaid health care benefit. After the five-year look-back period, provided the trust owns the assets and not the Medicaid applicant, Medicaid cannot count the assets and the assets cannot be used to finance long-term cost.
Need an Elder Law or Medicaid Attorney?
Are you a senior? Or do you have an elderly loved one who needs Medicaid? If you answered “yes” to those questions, you need the help of a Medicaid attorney or an elder law attorney. An elder law attorney can help with a legal matter plaguing you (a senior) or your elderly loved ones.
Do you need advice on how to create certain legal documents? Or do you need help applying for Medicaid? Don’t hesitate to contact us. Our attorneys are experience and skilled for any task you have for them. So, make that call/contact now! We can’t wait to help you1
