FACT: According to the Agency for Health Care Policy and Research, 4 out of every 10 people over the age of 65, will wind up in a nursing home at some time.

FACT: The average cost of nursing home care on Long Island is approximately $12,000 per month.  That number can even be much higher depending upon the nursing home facility and the required care.

QUESTION: Would you be able to afford those fees should you or a loved one need to be placed in a nursing home?

Medicaid is a Federal program that will pay for most of your Long Term Health Care needs.  Medicaid is the single largest payer of Long Term Health Care in the country.

Chances are, Medicaid is the right choice for you.  However, you need to know the rules of Medicaid to successfully have them pay for your Long Term Health Care needs.  Those rules can be maddening to understand, so we thought it would be an excellent idea to reveal 5 secrets about the Medicaid program.

Secret 1:      No penalty for transferring assets to a spouse. You can legally transfer as many assets as you want to your well or community spouse and not suffer a penalty from Medicaid.  That’s right, you can transfer $1 million if you wish to your spouse, and still successfully apply for Medicaid benefits, so long as you use Secret # 2 along with the transfer.

Secret 2:       Spousal Refusal. In New York State, a well or community spouse can sign a statement refusing to pay for the medical expenses of the institutionalized spouse and Medicaid, in New York, will determine eligibility of the applicant without considering the resources of the community spouse.  This is known as “spousal refusal”.  This will allow for the institutionalized spouse to receive nursing home care services right away and have those services paid for by Medicaid.

Secret 3:       You can legally transfer all your assets away to a disabled child. If you have a child that is receiving Social Security Disability, you can hand over all of your resources to that child, thereby protecting your assets and still have Medicaid pay for your Long Term Health Care immediately. A pretty nifty tool if you fall under this category.

Secret 4:       No look back period for Home Care. If the institutionalized spouse needs only non-nursing or custodial care (ex: toileting, bedding, assistance walking around, etc.), and that care takes place at home…there is no look back period of 5 years.  The look back period is 0 days!  That means you can transfer all your wealth away and the 1^st day of the month following the transfer, you could be eligible for Medicaid benefits. A great option if you are not in need of full blown nursing home care.

Secret 5: Preplan!! The ability to preserve your assets and still have Medicaid pay for your future Long Term Health Care can be greatly increased if you just plan for that in advance.  Plan when you are healthy and the 5 year look back period will not be such a huge obstacle.  With preplanning you will still be able to keep control of your assets and you will avoid having to rely on the first 4 secrets. Transfers can take place to an irrevocable trust, or to other non-exempt recipients not discussed in this article.

Keep in mind that the information contained in this article is a simplification of the extremely complex rules and laws surrounding New York State Medicaid.  By transferring assets to another person or to an irrevocable trust, you can protect all or part of your savings, but often times there can be adverse tax consequences and/or a penalty period of ineligibility.

It is always a wise idea to have the rules and concepts behind Medicaid explained to you by an experienced attorney who concentrates on Medicaid Planning. Furthermore, it is best to consult an attorney before making any transfers on your own.

Call the Law Office of Craig A. Andreoli, P.C. for a complimentary consultation on Medicaid Planning.  We can help advise you as to whether with proper planning you can qualify for New York State Medicaid benefits.

Spousal Refusal Legal Humor

 Find out more about Spousal Refusals here  http://www.andreolilaw.com/what-is-spousal-refusal/

Medicaid is a means tested program requiring that the applicant meet certain income and resource levels. The rules of Medicaid come at both the Federal and State level and are managed at the County level.  This article looks at how the Spousal Refusal can be utilized under New York State Medicaid rules to get Medicaid benefits to a married couple who jointly exceed the Medicaid resource and income levels.

Medicaid will look to the applicant’s resources and income as well as any legally responsible relative’s income and resources when considering Medicaid eligibility. Legally responsible relatives include spouses and parents or step parents of children under 21 years of age. 

For an individual to be eligible for Medicaid in New York, he cannot have more than $13,800 in non-exempt property. If he does, he will be denied Medicaid. If he meets the resource allowance, then his spouse (“community spouse”) is entitled to a resource allowance between approximately $75,000 and $109,000 depending upon the couple’s non exempt resources. Any monies above the determined resource allowance will be used by Medicaid towards the spouse in an institution’s care.

Fortunately, there are two steps that can be taken in New York to help a spouse in an institution whose resource levels exceed those mandated by Medicaid. First, a transfer between spouses does not invoke a Medicaid penalty. This allows the spouse in an institution to legally transfer all his assets to his spouse without penalty.  Second, New York recognizes “spousal refusal”. In other words, the community spouse who now holds all, or the majority, of the couple’s assets in her name, can evoke “spousal refusal” by signing a statement refusing to contribute income or resources to the spouse in an institution’s medical care. If this is done, the Medicaid agency is required to determine the eligibility of the spouse in an institution based solely on his income and resources without considering the community spouse’s income or resources.

The main benefit of New York State allowing spousal refusal is that elders in need of immediate long term health care, who exceed the maximum resource limits set for a husband and wife, can get Medicaid benefits almost …immediately! 

The Medicaid agency, however, is not without recourse. It has the option to commence a legal proceeding to force the community spouse to support the spouse in an institution. It can also file a claim for reimbursement against the community spouse’s estate following her death.  

This article was written on February 26, 2010.

Health Fair being given in East Port. Many professional service providers will be speaking on various health related topics, including me. I will concentrate on explaining the rules and planning strategies involved with obtaining Medicaid. Please RSVP @ 631-686-6500 if you are interested in attending.