Q: What's the best way to protect a house from Medicaid?
A: There may be several options for each situation, but prudent planning prior to a placement crisis will likely yield the most favorable outcome. One option that can work well is the use of an irrevocable trust. Such a trust has many advantages over an outright gift, including potential tax benefits, but requires preplanning.
Q: What are some legitimate ways to spend down to qualify for Medicaid benefits?
A: There are many practical approaches to spend down, but one of the most important factors is timing. Not starting too early to spend for the sake of spending down can save money in the long run. Spend down starts after the applicant has been confined for 30 days or longer to a qualifying institution. When the time is right, some options include home upgrades or repairs, which can be especially helpful to the community spouse to allow that person to continue to age in place successfully. Additionally, purchasing a pre-need funeral may save a family the extra stress of planning a funeral when emotions are high following the death of a loved one. To know for certain how much to spend, what options may be unique to your family and when spending is appropriate, you should meet with a local elder law attorney familiar with the intricacies of Medicaid law.
Q: What is a Medicaid qualifying annuity?
A: An immediate annuity is a contract with an insurance company under which the annuitant pays over a certain amount of principal in exchange for a company's commitment to pay out an income stream for a specific number of years. The annuities must meet certain parameters, and each state treats them somewhat differently. For this reason, it is best to get the advice of a local elder law attorney.
Q: What happens if the annuitant dies before the Medicaid qualifying annuity's term is up?
A: Suppose a community spouse has an immediate annuity with a 10-year term certain. After five years, the annuitant dies. The state's Medicaid program is the primary beneficiary on a Medicaid qualifying annuity, and the Medicaid program is supposed to be reimbursed out of the future annuity payments for whatever has been paid out in benefits for the nursing home Medicaid recipient.
Q: What happens when a Medicaid recipient receives an inheritance?
A: When a Medicaid recipient receives an inheritance, whoever is representing that person will have to notify the Medicaid agency in her state. Coverage will likely then end unless the money can be spent down to the countable asset limit timely. The money can be spent on anything that will benefit the individual but cannot be gifted away without incurring a penalty period of ineligibility.
For almost 20 years, the Elder Law Practice of Timothy L. Takacs has been helping families respond to the legal, financial, physical and psychological challenges presented by long life, illness and disability. As an elder law practice that specializes in Life Care Planning, we help families protect assets and coordinate care. Founder Timothy L. Takacs, Certified Elder Law Attorney, one of the most respected elder law attorneys in the nation, leads an interdisciplinary team of care coordinators and other professionals who work together to enhance the quality of life for elders. "Like" Elder Law Practice of Timothy L. Takacs on Facebook and see the latest from Elder Law Practice in your Facebook newsfeed each day. To learn more, call 615-824-2571.