Most people have at least a vague idea of what Medicaid is and what type of benefits the Medicaid program offers to those who are eligible. Unless you have participated in the program before, however, you may find that much of what you believe about the program is not rooted in fact. As you get closer to your retirement years, it becomes more and more important to separate fact from fiction where Medicaid is concerned because you may find that you need to depend on Medicaid to cover your own, or a spouse’s, long-term care (LTC) expenses. With that in mind, a Port St. Lucie Medicaid planning attorney discusses the “Top 5 Medicaid Myths”
- Medicaid is only for children. Medicaid is frequently thought of as health insurance for children of low-income families. While it is true that many children from low-income families do qualify for Medicaid, the Medicaid program is not limited to children. Medicaid may also provide healthcare benefits to the parents of qualifying children, to disabled individuals, and to the elderly if they meet all eligibility requirements.
- I don’t need Medicaid because I have Medicare. This common misconception frequently leads to disastrous results when it causes the failure to include Medicaid planning in your estate plan. Once you reach retirement age you will automatically be enrolled in Medicare if you, or a spouse, paid into Medicare over the course of your working years. While Medicare will cover many of your basic healthcare expenses, it will not cover LTC expenses. For over half of all seniors currently in LTC, Medicaid is the only help they get with their LTC bill.
- I have to give up my house to qualify for Medicaid. Like many myths, this one has a kernel of truth in it. While most states exempt a primary residence from an applicant’s “countable resources” when determining eligibility, many other assets do count. If the value of your countable resources is above the threshold (just $2,000 for an individual in most states) your application will be denied. To qualify, you will have to “spend-down” your excess assets. So, while your home is probably safe, you could lose other assets if you need Medicaid in the future and you failed to plan for that possibility.
- My spouse will be left with nothing if I need to qualify for Medicaid. Although it has been decades since the Medicaid Spousal Impoverishment Rules were enacted, this myth continues. Prior to changes in the Medicaid rules the spouse that remained in the community (the “community spouse”) was often left with virtually no income and few, if any, resources. The Spousal Impoverishment Rules were created to prevent this from happening. Now, a community spouse is entitled to retain half (in most cases) of a couple’s countable resources as well as all of his/her income. If that income is still not sufficient to maintain the community spouse, a community spouse can sometimes even retain a portion of the institutionalized spouse’s income.
- I don’t need to worry about my eligibility until I need the benefits. You may have heard people urging you to include Medicaid planning in your estate plan now and wondered what the hurry is, assuming you don’t need to qualify for benefits at the present time. The reason you need to plan ahead is that Medicaid uses a five-year “look-back” rule that prevents asset transfers in anticipation of the need to qualify for benefits. Your finances will be reviewed and any transfers made for less than fair market value will be penalties.
Contact Port St. Lucie Medicaid Planning Lawyers
For more information, please join us for an upcoming FREE seminar. If you have additional questions or concerns regarding Medicaid benefits and/or eligibility, contact the experienced Port St. Lucie Medicaid lawyers at Kulas & Crawford by calling (772) 398-0720 to schedule an appointment.