For many people, Medicaid planning is an excellent way to address the problem of paying for long-term healthcare costs, especially after they retire. However, there is always the question of when it is a good time to start preparing to apply for Medicaid benefits. So when should you start Medicaid planning, and what might happen if you wait too long?
What is Medicaid Planning?
In simple terms, Medicaid planning is the process of making sure your assets are secured and protected so that when you apply for Medicaid, those assets won’t be counted in determining your eligibility. In some cases, it involves the use of a Medicaid Asset Protection Trust, also known as a MAPT or simply a Medicaid trust. Assets placed into this type of trust might not be counted in determining your eligibility if the Trust is drafted properly and in advance of the current 5 year look back period. If done timely and correctly your assets are protected and you might still qualify for Medicaid, allowing you to obtain benefits even if you ordinarily might not.
When is a Good Time to Start Medicaid Planning?
While there is no specific time period for when you must begin Medicaid planning, you must be mindful of the “lookback period” that applies to Medicaid applications for Nursing Home Care. This rule allows the Medicaid agency to review all assets you held by you within the last 5 years of the date you apply for Medicaid. Thus, you cannot simply transfer your assets into a Medicaid trust and qualify for Nursing Home Medicaid right away. However, for long-term community-based care, there is currently no look back period. There may soon be a 30-month (two-and-a-half year) lookback period for community Medicaid but that rule is not yet in effect.
What Might Happen if You Wait Too Long?
If you wait too long to begin Medicaid planning, you may find yourself ineligible due to the 5 year look back rule and not qualify for Medicaid to pay for nursing home care as a result. If you want to be eligible for nursing home Medicaid benefits, you should start planning as soon as possible to avoid the five year look back period. The sooner you start, the fewer problems you will likely have.
What Should You Do?
In order to maximize the benefits of Medicaid planning and other forms of estate planning, you should speak to a lawyer with experience handling Medicaid and elder law matters. An elder law attorney can help you go over plans and ensure they cover all of your needs. The sooner you call, the sooner they can get to work for you.
If you or a loved one are dealing with legal issues related to estate planning, or you are dealing with any other issue related to elder law, you will need specialized legal advice. The attorneys at Hobson-Williams, P.C. are skilled in all aspects of elder law, and are dedicated to representing clients with diligence and compassion. To speak to an attorney or to schedule a consultation, call 866-825-1LAW.
