It can be a difficult task for one to prepare for their own nursing care. However, it can be made much easier by learning the basics of care, payment for long-term care, Medicaid planning and Medicaid eligibility, and by identifying professionals that can walk the potential care recipient through the planning and spend down process.
When a person begins the process of identifying long-term care facilities for themselves, the process can seem daunting and exhausting. Medicare does not pay for long-term care. The only remaining options for payment for skilled nursing care is private pay and Medicaid eligibility, or perhaps long term care insurance. If private pay is not a true long-term option, then it is vital for the individual to immediately begin the process of learning about Medicaid planning.
Medicaid will pay for skilled nursing nursing home costs for those individuals who physically qualify for a nursing home level of care and whose countable assets are under the applicable asset limit. In Missouri, for example, the asset limit for financial eligibility for Medicaid eligibility is currently $6,000. Countable assets include any assets other than non countable assets: primary residence, auto, home modifications, personal property and burial plan principally.
If the potential applicant is under all applicable income and asset limits, then the person will achieve Medicaid eligibility financially. If the person has assets over the Medicaid limit, then planning for Medicaid eligibility would be prudent. If the person enters the facility with some, but not sufficient, private pay assets, then the care recipient will simply spend down the assets that they possess at the facility until they have exhausted their private pay assets under the applicable Medicaid asset limit, then plan to transition to Medicaid eligibility to pay for the skilled nursing long-term care. The applicant’s income would be applied to the monthly cost (less a monthly personal needs allowance), with Medicaid paying for the remaining nursing home costs.
If the person has the ability to plan ahead for the need for a nursing facility level of care and is not in a crisis planning situation, and has significant assets, then certainly Medicaid planning would be advisable. If the need for care may be outside of the five year look-back period, perhaps setting up and irrevocable trust for asset protection purposes. Any otherwise countable assets transferred to a properly established irrevocable trust more than 5 years before a need for Medicaid eligibility (the look-period) are no longer considered countable assets and will not affect Medicaid eligibility and will not affect applicable asset limits with no penalty period, resulting in significant asset protection. Quality Medicaid Care, or a qualified local elder law attorney can help families establish irrevocable trusts. as part of their estate planning. Asset transfers within the 5 year look-back period will result in a penalty period.
Special (and advantageous) policies apply for Married Couples. The non applicant spouse can file a Division of Assets to set up a Community Spouse Resource Allowance that will allow he or she to declare certain assets as non countable and available to the Community Spouse in order to avoid Spousal Impoverishment. Additionally, these Community Resource Allowance assets avoid any estate recovery by the state after the death of the Medicaid recipient spouse. Additionally, the Community Spouse can receive a portion of the Medicaid applicant spouse’s income to live on a month to month basis, called the monthly maintenance needs allowance.
The same eligibility and planning tools used for Medicaid eligibility in a skilled nursing facility also apply to applications for home health care and Home and Community Based Services (HCBS). If the compromised activities of daily living are not significant and do not require a nursing facility level of care, then planning for Medicaid long term care assistance in home can be an option.
Unfortunately, and paradoxically, Medicaid assistance does not play a large role in paying for assisted living facility care, thus leaving home care and skilled long term care as the only options for individuals with a limited ability to pay for care.
Finally, while Medicaid Compliant Annuities are typically used in married couple situations, they can also be used by single applicants.
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