The Medicaid Program was created to provide financial assistance for the health care of those in need. The federal government designed Medicaid and funds the majority of the program. Each state is required to enact laws to reflect the federal Medicaid rules including rules that govern the eligibility of its own citizens. Some of the federal statutes give states choices on how to implement the federal rule and sometimes states interpret the rules differently. As a result, Medicaid eligibility rules vary from state to state. In addition, Medicaid eligibility rules are often confusing and it is challenging to find accurate and useful information anywhere. In fact, many families are actually given the wrong information regarding eligibility rules and what can be done to protect assets.
Statistics show that most of us will face at least a temporary stay in a nursing home facility at some point in our life and many of us will encounter the need for a long-term placement in a nursing home. The Department of Health and Human Services estimates that over nine million people will need long-term care this year and that 70% of all persons over age 65 will need some type of long-term care services during their lifetime. This presents a serious problem for those families that are not prepared, because long-term care is expensive and there are only so many ways to pay for it.
Medicare was never intended to pay for our long-term care expenses on a long-term basis, but Medicare may pay for a maximum of one hundred days. But only under certain conditions and Medicare shifts to a co-pay after the first 20 days. Once Medicare benefits end, many families begin to pay out of pocket for the cost of long-term care until they become eligible for Medicaid benefits. Very few people have long-term care insurance to help with this cost. Most people would want to avoid the excruciating process of watching their assets being completely used up by the cost of their long-term care needs, if they knew how to avoid that situation.
But the situation is not hopeless. We can help a family protect assets even after a spouse or parent enters the nursing home. We view Medicaid Eligibility Planning as the transfer of assets and the investment of assets in a way permitted by state and federal law that increases the contribution made by Medicaid to the cost of long-term care and as a result reduces the contribution the family makes toward that care.
In Indiana and Illinois, for our clients participating in our Medicaid Eligibility Planning process, the expectation is that a significant amount of assets can typically be protected for the family after the loved one enters the nursing home.
Please contact our office if you need additional information or would like to schedule an appointment with one of our attorneys or check out the workshop calendar on this website for a workshop on this topic.