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Medicaid Planning: Protecting Your Assets and Your Eligibility

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Medicaid is a health insurance program for low income individual and families as well as for the disabled and elderly.
Medicaid is primarily funded by the U.S. federal government; however, the individual states may also add to their Medicaid funding.
Learn more about medicaid planning in this presentation.

Published in: Law
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Medicaid Planning: Protecting Your Assets and Your Eligibility

  1. 1. 528 College Road Greensboro, NC 27410 ❍ Phone: (336) 547-9999 Protecting Your Assets and Your Eligibility MEDICAID PLANNING
  2. 2. 528 College Road Greensboro, NC 27410 ❍ Phone: (336) 547-9999 WHY COMPREHENSIVE ESTATE PLANNING IS NECESSARY Estate planning is something that should be ongoing, not something that is done once and forgotten.
  3. 3. 528 College Road Greensboro, NC 27410 ❍ Phone: (336) 547-9999 As you grow, so does your family and your estate.
  4. 4. 528 College Road Greensboro, NC 27410 ❍ Phone: (336) 547-9999 Consequently, your estate plan should also grow to ensure that you, your family, and your assets are protected.
  5. 5. 528 College Road Greensboro, NC 27410 ❍ Phone: (336) 547-9999 One threat to those assets, particularly during your retirement years, is the cost of long-term care.
  6. 6. 528 College Road Greensboro, NC 27410 ❍ Phone: (336) 547-9999 Medicaid can help; however, you must first qualify for benefits.
  7. 7. 528 College Road Greensboro, NC 27410 ❍ Phone: (336) 547-9999 Once again, your hard-earned assets may be in jeopardy unless you include Medicaid planning in your comprehensive estate plan now.
  8. 8. 528 College Road Greensboro, NC 27410 ❍ Phone: (336) 547-9999 WHAT IS MEDICAID? Medicaid is a health insurance program for low income individual and families as well as for the disabled and elderly.
  9. 9. 528 College Road Greensboro, NC 27410 ❍ Phone: (336) 547-9999 Medicaid is primarily funded by the U.S. federal government; however, the individual states may also add to their Medicaid funding.
  10. 10. 528 College Road Greensboro, NC 27410 ❍ Phone: (336) 547-9999 Medicaid is administered by the individual states which causes the eligibility criteria, as well as available benefits, to vary somewhat from one state to another.
  11. 11. 528 College Road Greensboro, NC 27410 ❍ Phone: (336) 547-9999 WILL YOU NEED LONG-TERM CARE? The longer you live, the better the odds are that you will need long-term care at some point.
  12. 12. 528 College Road Greensboro, NC 27410 ❍ Phone: (336) 547-9999 In fact, the odds of needing long- term care at any time in your life are likely higher than you realized. Consider the following facts and figures:
  13. 13. 528 College Road Greensboro, NC 27410 ❍ Phone: (336) 547-9999 During your working years you stand a 1 in 5 chance of suffering an injury or illness that leads to the need for long-term care. By age 65, you stand a 1 in 2 chance of needing long-term care before you die. At age 85 those odds increase to 3 in 4 The average yearly cost of long-term care is over $80,000 nationwide
  14. 14. 528 College Road Greensboro, NC 27410 ❍ Phone: (336) 547-9999 In North Carolina, the average yearly cost for long- term care is just over $90,000 as of 2016 Looking 20 years into the future, that cost is projected to run about $160,000 a year The average stay in a long-term care facility is 2.5 years
  15. 15. 528 College Road Greensboro, NC 27410 ❍ Phone: (336) 547-9999 Medicare does not cover long-term care costs nor will most private health insurance policies. Medicaid does cover long-term care costs Almost half of all seniors count on Medicaid benefits at some point
  16. 16. 528 College Road Greensboro, NC 27410 ❍ Phone: (336) 547-9999 CAN MEDICAID HELP? Although Medicaid does cover long-term care costs, qualifying for benefits can be challenging for many seniors.
  17. 17. 528 College Road Greensboro, NC 27410 ❍ Phone: (336) 547-9999 Here’s why:
  18. 18. 528 College Road Greensboro, NC 27410 ❍ Phone: (336) 547-9999 The problem for most senior applicant’s is that Medicaid uses income and asset limits when determining eligibility. The asset, or “countable resources” limit is as low as $2,000 for an individual in many states. “Countable resources” refers to assets that count toward your eligibility limit.
  19. 19. 528 College Road Greensboro, NC 27410 ❍ Phone: (336) 547-9999 Some assets are exempt from your “countable resources,” such as a home, a vehicle, and a burial plot. If the value of your assets exceeds the program limit you will be required to rely on those assets before Medicaid will start covering your expenses. Your hard-earned assets could be depleted within a matter of months.
  20. 20. 528 College Road Greensboro, NC 27410 ❍ Phone: (336) 547-9999 CAN’T I JUST TRANSFER ASSETS TO MY CHILDREN BEFORE I APPLY? Transferring assets right before applying for Medicaid no longer works.
  21. 21. 528 College Road Greensboro, NC 27410 ❍ Phone: (336) 547-9999 Medicaid now uses a five year “look-back” rule. Allows Medicaid to review your finances for the 5- year period prior to applying for benefits. Asset transfers during that time frame may be ignored The value of assets transferred will be imputed back into your estate for the purpose of determining eligibility for Medicaid.
  22. 22. 528 College Road Greensboro, NC 27410 ❍ Phone: (336) 547-9999 HOW CAN MEDICAID PLANNING HELP? The key to protecting your hard-earned assets and ensuring that you will qualify for Medicaid benefits should you need them in the future is to incorporate Medicaid planning into your comprehensive estate plan now, long before the need to qualify for Medicaid actually arises.
  23. 23. 528 College Road Greensboro, NC 27410 ❍ Phone: (336) 547-9999 WHAT IS MEDICAID PLANNING? Medicaid planning looks ahead to the likelihood that you, and/or your spouse, will need to qualify for Medicaid in the future.
  24. 24. 528 College Road Greensboro, NC 27410 ❍ Phone: (336) 547-9999 Legal strategies are incorporated into your estate plan to protect your assets and ensure that you will qualify for Medicaid benefits should you need them in the future.
  25. 25. 528 College Road Greensboro, NC 27410 ❍ Phone: (336) 547-9999 A Medicaid trust, for example, might be created to remove assets from your estate and protect them, thereby reducing the value of your “countable resources” and allowing you to qualify for benefits.
  26. 26. 528 College Road Greensboro, NC 27410 ❍ Phone: (336) 547-9999 WHAT ABOUT LAST MINUTE MEDICAID PLANNING? Ideally you should incorporate Medicaid planning into your estate plan at least five years prior to the need to qualify for benefits to remain safely outside of the five- year “look-back” rule.
  27. 27. 528 College Road Greensboro, NC 27410 ❍ Phone: (336) 547-9999 Last minute Medicaid planning might still be able to help you though.
  28. 28. 528 College Road Greensboro, NC 27410 ❍ Phone: (336) 547-9999 An experienced estate planning attorney might be able to use some Medicaid planning strategies to help you even if you failed to start planning early on.
  29. 29. 528 College Road Greensboro, NC 27410 ❍ Phone: (336) 547-9999 If you have questions regarding Medicaid planning, or any other estate planning matters, contact us online or call us at (336) 547-9999 for a free consultation
  30. 30. 528 College Road Greensboro, NC 27410 ❍ Phone: (336) 547-9999

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