For many people, growing older means dealing with greater health costs, which they may not be prepared to pay for. In such cases, Medicaid planning can offer a means of covering medical expenses without draining a person’s savings or putting them in financial danger. But how exactly does Medicaid planning help seniors who may struggle to pay their medical bills?
What is Medicaid Planning?
“Medicaid planning” refers to the process of structuring your personal assets in a way that will allow you to qualify for Medicaid benefits when you otherwise would not be able to. This means you can ensure Medicaid will pay for your medical costs rather than paying out of pocket. For people who may have significant long-term medical expenses, this is an important potential way to ensure your healthcare needs will be taken care of well into the future.
How Does Medicaid Planning Work?
Medicaid benefits are normally only available to people whose income is below a certain level, and who have less than a certain amount in personal assets. While people who are retired often fall below the maximum income threshold, they also often have too many personal assets to qualify for Medicaid. By reorganizing their assets using tools such as the Medicaid Asset Protection Trust (sometimes known simply as a Medicaid trust), they can reduce their effective assets’ value and qualify for Medicaid benefits.
Who Should Consider Medicaid Planning?
Generally speaking, Medicaid planning is for anyone who may struggle to pay for private insurance or other medical costs once they retire. While some people are fortunate enough to be able to handle these costs by themselves with their retirement savings or investments, many others would make themselves destitute trying to pay for their medical expenses, even though they do not qualify for programs like Medicaid. With Medicaid planning, you can get the benefits of Medicaid eligibility without fear of losing everything you own.
When Should You Begin Medicaid Planning?
Due to a recently instituted 30 month lookback period on long-term healthcare, which is set to go into effect in January 2022, it is more important than ever that you begin Medicaid planning as soon as possible. Otherwise, you may face significant penalties that will limit the benefit you can receive from your Medicaid benefits. That is why you should contact a lawyer with knowledge of estate planning who can help you figure out what might be best for you and your loved ones.
The estate law attorneys at David J. Lorber & Associates, PLLC will thoroughly analyze your estate and work with you to determine the best means of transferring your assets, minimizing taxes, and ensuring your needs are met. For comprehensive estate planning services in New York, call David J. Lorber & Associates, PLLC at (631) 750-0900 or contact us online to schedule a free consultation at our Setauket office.