A significant portion of Americans will require long-term care of some sort in their lifetime. This care can be incredibly expensive. While you might be able to afford it, paying for it out of your own pocket can severely decrease your estate, which means that your loved ones will be left with significantly less than you may have initially intended. With careful planning, though, you might be able to avoid this outcome, receive the care you need, and protect your loved ones and your estate.
The importance of Medicaid planning
If you plan wisely, then Medicaid might help you pay for any long-term care you may need in the future. The program has strict income and asset requirements, though, which means that there’s a significant likelihood that you won’t qualify as things stand. However, by engaging in sound estate planning and utilizing appropriate trusts and gifting measures, you can reduce your assets and your income, thereby allowing you to qualify for Medicaid.
Beware of the look back period
However, proper Medicaid planning requires some foresight and pre-planning. This is because Medicaid has a look-back period of 60 months, meaning that the government will look back 60 months to see how you have handled your assets and whether you have improperly given them away for the mere purpose of qualifying for Medicaid. This is because the government would prefer for you to pay for your own care if you can afford it, and it doesn’t look kindly upon those who try to pass the bill onto government programs.
But there’s nothing wrong with Medicaid planning. You just need to make sure that you’re developing the estate plan that will help you qualify well in advance of your actual need for Medicaid. There may be some exceptions and loopholes that you can use within the look back period, but the stakes are simply too high to risk acting in a way that would affect your ability to qualify for Medicaid.
Therefore, if you think that you’d like Medicaid to assist you to pay for your care in the future, then it might be time to discuss your circumstances with an experienced elder law attorney.