Medicaid planning can be overwhelming, but the effort pays off once your parents’ applications are approved. Meeting the requirements is essential, and one of them is satisfying the home equity limit of $1,130,000.
If your family home meets this threshold, your parents may qualify for long-term care. But what happens to the property after they pass?
Understanding the Medicaid Estate Recovery Program
In New York, the Medicaid Estate Recovery Program seeks reimbursement for the cost of long-term care after a recipient passes away. The Local Department of Social Services (LDSS) acts as a preferred creditor. They can file a claim against the estate for every dollar spent on nursing facility services and related hospital or prescription drug costs.
Considering the available exemptions
New York does allow for specific deferrals. Recovery is generally paused if:
- The deceased has a surviving spouse.
- The deceased has a child under the age of 21 or a child with a disability.
- Heirs can prove that recovery would cause undue hardship.
Despite these protections, it would be best to take a proactive approach to fully secure your parents’ estate.
Preparing for the future effectively
The future can be uncertain, but having a backup plan can offer peace of mind. One of the common strategies is creating a Medicaid Asset Protection Trust. By transferring the home into this irrevocable trust at least five years before needing nursing care, you remove the property from the probate estate, effectively placing it beyond the state’s reach.
Given the complexities of Medicaid Planning, the road ahead can be difficult. Seeking legal help can offer the guidance you need to ensure your parents’ eligibility for long-term care remains.
