Elder Law and Medicaid Planning

Senior Couple (not actual clients)

What is the role of Medicaid Planning in Elder Law? Often Adult Children of aging parents walk into my conference room concerned  about their parents’ financial health care expenses, long-term care needs, mental capacity, and a lack of financial resources. Adult children want solutions. Every family circumstance is different. Often, the solution involves Medicaid pre-planning or a crisis plan. Let’s review the role of Medicaid in Elder law.

Medicaid Myths and Elder Care Law

Medicaid myths hinder estate planning in Elder law. One myth is that hard-working middle-class retirees do not qualify or will not need Medicaid. For the most part, employees do not have health insurance. Unfortunately, many do not plan for long-term care. Nursing Home Facilities and Memory Care Units increase in costs every year.  The average wage earner is not prepared for a financial cost ranging from $7000 to $10,000 a month. Medicaid will become necessary to help with the financial cost of care.

Another myth is that Medicaid replaces family care giving. Family care givers bear the financial responsibility for aging parent care.  At some point, the out-of-pocket expenses and emotional cost take a toll on a family. Medicaid offsets the financial expenses. For other Medicaid myths that hinder proper planning in Elder care law visit https://www.aarp.org/content/dam/aarp/ppi/2018/10/myths-about-medicaid.pdf 

Medicaid is not Medicare

One confusion among seniors and families concerns the difference between Medicare and Medicaid. Medicare is a plan a Senior opts into at the age of 65 years old to avoid a penalty payment.  Medicare is a drug prescription plan deducted from Social Security and provides other plan options through private insurance. It is not a long-term care plan. Medicaid is a government benefits for those who meet the criteria and need financial assistance for long-term care. Planning involves helping one to financially qualify for Medicaid.

Elder Care and Medicaid Planning

Medicaid planning for elder care consists of a Medicaid Pre-plan or a Medicaid crisis plan. Pre-planning is a five-year estate plan that seeks to protect hard earned estate legacies such as a house and other finances. Most states require a pay-back for the use of government benefits. A state may recover from a senior’s estate by filing a lien at probate against a house, or other monies. A pre-plan involves solutions such as a Medicaid Asset Protection Trusts (MAPT), personal care agreements, promissory notes, or even Medicaid-compliant annuities  to help protect assets against a time when Medicaid may become necessary.

A Medicaid crisis plan means that a person must qualify immediately for Medicaid because of an unexpected major health crisis such as a debilitating stroke or Alzheimer’s. A five-year plan in place may turn into a crisis plan if a person falls ill before five years is completed. Crisis planning also helps a person whose long-term care insurance is running out and will no longer cover the cost of care. There are exempt and non-exempt assets.The individual, the health, and the finances will be reviewed and analyzed for the best solutions.

Several strategies or solutions exist to help a Senior qualify for Medicaid while preserving some of the legacy. It’s important to remember that spending the money (spend-down) is not the only solution, or the best strategy.   Outright gifting of money leads to a penalty period. The aging parent needs to work with an attorney who analyzes a family’s financial situation to provide the best available solutions.

Your Elder Care Law Attorney

Missouri does not recognize law specializations. Consider retaining the attorney with the necessary experience in elder law. I possess the necessary education and work experience to understand aging and facilitate appropriate solutions for you and your family. Call me at 314.332.0011. Visit https://TuckerLegal-LLC.com to book a complimentary consultation today for planning and elder law issues.

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Sheri Tucker

Owner and Founder of Tucker Legal Services, LLC. I'm an attorney licensed since 1991 with a M.S. in Psychology. Member of ABA, MOBAR, BAMSL, Elder Counsel, Wealth Counsel, and NAELA.

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