So, your mother has been admitted to the nursing home. She and your dad own their own home and have some savings. She is facing a bill in excess of $12,000 per month for her care. Can you still engage in asset protection and qualify your mother for Medicaid now that she is in the nursing home? The answer is yes. There is no prohibition under the law or any nursing home policy that would prohibit a family from taking steps to qualify their loved one for Medicaid once they have been admitted to a nursing home.
What can be done to preserve assets and qualify your mother for Medicaid? Medicaid, also known as Medical Assistance, is the program that pays for the care of most individuals who are receiving care in a nursing home. There are various resource limitations and rules regarding gifts that make qualifying for the program challenging. In addition, there is a misunderstanding that planning must be done at least five years before admission to a nursing home.
The planning techniques available at the time your loved one enters a nursing home will vary depending upon the facts. The options are different for a married person versus someone who is single. One of the most effective methods of qualifying for Medicaid for those admitted to a nursing home is the use of Medicaid Qualifying Annuities.
When using a Medicaid Qualifying Annuity, a married couple can shelter a significant amount of excess resources that otherwise would have to be spent on their care. Medicaid Qualifying Annuities take excess resources and convert them to a stream of payments for the spouse who is staying at home. There is no limitation on the amount of excess resources that can be invested in these annuities for the benefit of the community spouse.
Medicaid Qualifying Annuities are also very helpful in an asset protection plan for a single person. Typically, these annuities are used in a plan of gifting. Another misunderstanding is that gifting is not allowed once someone is admitted to a nursing home. Gifts are permitted, however, there may be a corresponding period of ineligibility for Medicaid due to the gift. Medicaid Qualifying Annuities help to pay the nursing home during a period of ineligibility caused by a gift. In many cases, the gifted resources can be sheltered using a Medicaid Qualifying Annuity.
When proceeding with any asset protection plan, be aware that a power of attorney is an essential document to help family members shelter assets once their loved one has been admitted to a nursing home. Not all powers of attorney are drafted alike, and it is important to have a power of attorney that authorizes asset protection and the ability to qualify your loved one for Medicaid. Powers of attorney must be acquired while your loved one has the capacity to understand and sign the document.
