The cost of long term care by care facilities is pretty expensive for the average American. For this reason, many seniors, low-income families and disabled individuals often seek to benefit from Medicaid.
Medicaid, a program jointly funded by the federal and state government, is an ideal way to receive long term care at zero cost or little. However, this program is not for everyone. Medicaid is designed for specific individuals, especially those who cannot afford the long term care cost.
Generally, to be eligible for Medicaid, your income and assets needs to be below a certain limit However, if your assets is above the limit, you can still be eligible for Medicaid. All you have to do is set up a Medicaid asset protection trust. A Medicaid asset protection trust is designed to protect assets from being counted for Medicaid.
Let us take a look at what Medicaid is.
What is Medicaid?
Medicaid is regarded as a government program that offers free or low-cost health insurance to families and individuals with low-income. While the federal government makes the rules for the Medicaid program, each state operates its own program. In fact, it is possible for each state to designate a new name for their Medicaid program.
Since each state operates its own Medicaid program, the eligibility and benefits can vary greatly from state to state. The Medicaid program is jointly funded by the state and federal governments.
Who Is Medicaid for?
Medicaid is not for everyone. This government-funded program is designed for specific groups of people. This health care program is for you if:
- Don’t make enough money or are on a restricted budget
- Cannot work due to a disability
- Are already enrolled in Medicare but cannot afford the costs
- Are pregnant and don’t make enough money
The federal government requires that Medicaid cover a specific groups of individuals, such as people with low incomes. The government sets the minimum benefits, as well.
Your state also has a say over who gets covered. Generally, children, pregnant women, including individuals with different types of disability get the most coverage.
What is Medicaid Asset Protection Trust?
Based on the Medicaid requirements, a single Medicaid applicant must have income less than $2,382 each month and may keep up to $2,000 in countable assets to be financially eligible for the program. Generally, the government deem certain assets to be exempts or “non-countable” (usually up to a specific allowable amount.
If your assets and income is above the threshold, you can still qualify for Medicaid. To do this, you’ll have to set up a Medicaid Asset protection Trust.
A Medicaid asset protection trust is just as it sounds, a trust tailored to protects assets from being considered for Medicaid eligibility. A Medicaid asset protection trust allows and individual to qualify for long term care benefits from Medicaid, while securing assets from being used if long-term care is required.
Medicaid Asset Protection Trust and Look-Back Period
Provided the trust is made and assets transferred five years prior the donor applies for Medicaid long-term care benefits, Medicaid will not sanction the donor for transferring assets, and the existence of the trust will not affect Medicaid eligibility.
Assets placed in a MAPT are not considered countable for Medicaid. But, if Medicaid is requires before the expiration of the five-year look-back period, a disqualification penalty period can be applied before you get Medicaid benefits.
Do you need an Elder law attorney?
If you need an elder law attorney for matters regarding your elderly loved one, don’t hesitate to call our office. Or if you are a senior and you need help with applying for Medicaid, you can also contact us for assistance.
In addition, in the event that your assets and income are above the threshold, signaling your ineligibility for Medicaid, you can contact us if you wish to set up a Medicaid Asset protection Trust. However, you must have the Medicaid look back period in mind. This means that, after placing your assets in this trust, you are to wait for the next 5 years before applying for Medicaid to avoid any form of sanction.
