During the Medicaid application process, your finances are reviewed to determine eligibility. If you make over a certain amount in monthly income or have assets over specific limits, you can be left scrambling to pay for expensive nursing home or in-home care. That’s why it’s crucial to understand what specifically counts as an “asset” so you can receive the benefits you need without a penalty waiting period.
What Is Counted as an Asset?
Medicaid’s eligibility thresholds are strict and unforgiving, which causes problems when someone is suffering from a disability and needs some way of covering the cost of care right now. If you are over the limit in terms of monthly income or assets, your benefits will be reduced or denied until you spend down to the allowed amount. During the Medicaid application process, assets that are counted against you include:
- Automobiles (other than your first, primary vehicle for transportation)
- Bank accounts (checking, savings, single or joint accounts, etc.)
- Bonds, stocks, mutual funds, and other investments
- Cash
- Equity in your primary residence (above a certain dollar value threshold)
- Life insurance value
- Real estate or owned land
- Vacation or secondary homes
Failing to plan ahead for Medicaid coverage leaves vulnerable seniors in a situation where they have to find ways to convert countable assets into exempt forms. In many cases, your home can be exempted entirely, for instance. There are pitfalls in this process that an attorney can help you avoid to get the coverage you need, while still protecting your assets so there’s something left to pass on to family after you are gone.
Re-titling property into a spouse’s name, giving vehicles to family, or selling things below market value to friends won’t be the quick fixes you may expect. Those are all considered gifts under Medicaid guidelines, even if you sell them for less than they are worth rather than giving them away entirely.
Unfortunately, that will cause you serious problems with the program’s five-year lookback period. Any gifts of property, vehicles, cash, etc. that you give to friends or family will count against you when determining if you are above the asset limit threshold.
Exempting Assets While Applying for Medicaid in New York
These asset rules mean you could end up waiting months or even years for full benefits to kick in while you desperately need coverage for expensive care. While it didn’t previously apply, a lookback period is also now in place for community and home-based health services as well as nursing home coverage through Medicaid.
The good news for the application process is that some assets are automatically considered “non-countable” and therefore exempt, such as:
- Burial funds in a separate account up to a specific amount, pre-paid burial services, and life insurance payouts earmarked for funeral expenses
- Household goods (personal effects that aren’t an investment or a collectible gaining value)
- One primary vehicle
- Property used by your spouse for trade purposes, like a family business or farm
- Up to $2,000 in cash
- Your house or condo, up to a specific equity interest, if you are single and live alone
- Your house or condo, with an unlimited equity amount, if your spouse, child under 21, or disabled adult child of any age lives with you
Depending on your specific circumstances, there may be additional ways to convert countable assets into non-countable forms, such as by utilizing different kinds of trusts to preserve assets for your family. For example, some seniors may need to use a pooled income trust to retain access to funds while still maintaining eligibility under Medicaid’s inflexible limits.
Get the Help You Need From an Experienced Medicaid Planning Attorney
If you expect to need a nursing home or some form of at-home care, you need to speak with a lawyer about the Medicaid application process to tailor a plan to your specific financial situation. A Medicaid planning lawyer can help you apply at the right time for meeting eligibility rules while still protecting your family’s nest egg. Book a consultation today to discuss your Medicaid situation with Alatsas Law Firm.
|
Related Links: |