Plan more than five years ahead
If you are considering the possibility of taking advantage of Medicaid at any point in the future — not in the next five years, but much further than that — you should ask a Medicaid attorney about the laws that govern eligibility for Medicaid. There are limits to the income and the monetary value of the resources that anyone who applies for Medicaid is permitted to have. These limits are different in different states. If you live in North Carolina, you should know that resources for the aged, blind and disabled are limited to $2,000 for an individual or $3,000 for a couple, and monthly income is limited to $981 for an individual and $1,328 for a couple. Cash, retirement accounts, life insurance policies, stocks, bonds and other investments are all counted as resources for the purposes of Medicaid. If you have more than these limits, but you are also dealing with high medical bills, you may be eligible for a Medicaid deductible. A Medicaid attorney can tell you how to do this.
There is a kind of irrevocable trust which you can place assets so that they are no longer counted as resources. It is called a Medicaid Asset Protection Trust. But as far as the state is concerned, doing this does not make the assets cease to exist. The government will assume that you have sold them for fair market value, and will count that value as part of your resources even if you gave your assets away for no money at all.
The five years before you apply for Medicaid are critical. This is the look-back period within which the government tracks the sale or transfer of your assets. If you make any large gifts in this time period, there will be an eligibility penalty when you apply — that is, there will be a delay imposed before you are allowed to receive Medicaid. If you need nursing home care within five years of placing such assets into a trust, you will have to pay for such care yourself until the state deems you eligible. It is therefore important to begin planning to protect your assets more than five years before you intend to apply for Medicaid. This will mean finding a Medicaid attorney who can advise you as to what assets you can protect and how to protect them.
A Medicaid attorney in the Gastonia and Charlotte areas
Robert C. Whitt, Gastonia attorney, servicing the areas of Mount Holly, Charlotte, Gastonia and Gaston, Mecklenburg, Lincoln Counties and surrounding communities. He focuses on wills, trusts and other aspects of elder law. If you are thinking of making out your will or establishing a trust, call his office today.