If you are healthy, it can be difficult to imagine a situation where you would require full-time care in a nursing home. However, this is one possibility you should not ignore when you are thinking about the care and services you may need as you get older.
In fact, planning for this can be crucial, particularly if you anticipate utilizing Medicaid to pay for your care.
Planning for care long before you need it can be crucial for many reasons. First, it can allow you to protect your assets while also qualifying for Medicaid.
In order to qualify for Medicaid, you must not exceed income or asset limits. If you exceed these limits, you may have to spent down the excess on care. With the cost of nursing home care averaging $9,000 to $10,000 per month, a lifetime of savings can be rapidly dissipated. You may be able to avoid this by planning ahead.
You can preserve assets in various ways, including converting countable assets (e.g., cash, investments, etc.) into exempt assets (e.g., home improvements, personal property, an auto, etc.). You can also give away assets; however, this has to be done carefully as gifts can result in the imposition of a period of ineligibility for Medicaid if made within the five year period prior to applying for Medicaid. That being said, there are also techniques where, with proper planning and the help of a professional, at least one-half of the applicant’s assets can often be preserved, even in an emergency. With prior planning, however, it may be possible to perserve substantially all of the assets and still qualify for long-term care Medicaid.
Taking a comprehensive approach to care planning
Medicaid is a critical element of care planning, but it is only one part. Having a will, advance care directives and other financial tools in place can also be crucial in terms of protecting your property and the people you care about.
You may not anticipate that you will require long-term care or live in a nursing home facility. However, having a plan in place in case you do can give you and your family a great deal of comfort during a challenging time.