Medicaid is a federal program, but administered differently and with different regulations in each state. Some states, like Florida, have relatively lenient eligibility requirements while other states, like New Jersey, are more restrictive. The "Get out of Dodge" plan referred to above is one attorney's advice in a recent Asbury Park Press article titled "Protecting assets: Three things to know before Medicaid." For those living in restrictive states, he literally suggests moving to a less restrictive one, like Florida.
Of course, not everyone can or wants to use the Get Out of Dodge plan. Thankfully there are other ways to preserve assets. For example, when only one spouse goes to a nursing home the couple's home may be exempt from Medicaid's asset eligibility calculations, meaning it would not have to be sold to pay nursing home expenses before Medicaid. The healthy spouse can still live there. However, if the healthy spouse dies first, things can get complicated: the house could be lost to pay the nursing home costs of the surviving spouse.
Here are a few facts to keep in mind. Families should:
- Create a comprehensive power of attorney—it's critical to prevent court involvement;
- Do Medicaid estate planning long before you think you may need it to avoid making irreversible mistakes;
- Consult with an attorney about trust planning with Medicaid eligibility in mind. Although trusts can be great Medicaid planning tools, they are complex and missteps can be costly.
Despite the complexity, an experienced elder law attorney may be able to help preserve your assets in the face of long-term nursing care.
You can learn more about this topic as well as other strategies on our website under the tab entitled: elder law planning in Virginia. Be sure you also sign up for our complimentary e-newsletter so that you may be informed of all the latest issues that could affect you, your loved ones and your estate planning.
Reference: Asbury Park Press(January 24, 2015) "Protecting assets: Three things to know before Medicaid"