MEDICAID & LONG-TERM CARE

If you are facing financial stress or the prospect of liquidating assets to pay for long-term care, you need assistance from one of our Medicaid planning attorneys. Medicaid eligibility is extremely complicated and even simple errors can result in the denial of benefits. With our proven strategies, you can obtain the benefits that you want and the peace of mind that you need. 


WHAT IS MEDICAID PLANNING?

A general definition of Medicaid planning is any assistance provided to a potential Medicaid applicant in advance of, and in preparation for, their Medicaid application.  Medicaid planning can be as simple as assistance with the collection and preparation of documents. However, it can also require a complete restructuring of financial assets and/or seeking asset or income protection through the court.

WHY ENGAGE IN MEDICAID PLANNING?

  • Long term care is very expensive, and families want to ensure their loved one receives the care they require.

  • To ensure that a healthy spouse, who lives at home, will have the financial resources to continue doing so.

  • To preserve a family’s limited assets and ensure the next generation can live in a home and/or afford an education.

ADVANCE PLANNING STRATEGIES

There are numerous strategies our attorneys may employ to protect your assets and plan for Medicaid/long-term care:

  • Create an Estate Plan
    Durable Power of Attorney (Single or Married). If you become incapacitated, the person in charge of your affairs will need comprehensive legal authority to act on your behalf to protect assets and apply for benefits.

  • Avoid Probate on Death (Single or Married)
    In 2007, Michigan passed the Estate Recovery Act which allows the State of Michigan to recoup long term care benefits paid from the recipient’s probate estate on death.  Avoiding probate can avoid recovery.

  • Ladybird Deed
    Primary Residence (Single or Married).  A ladybird deed allows the property owner to retain ownership of their primary residence for life and designate a beneficiary on death thereby avoiding probate.  This excludes the property as a countable asset when applying for Medicaid and avoids probate and Estate Recovery upon death.

  • Transfer Primary Residence into Trust (Married Only)
    This strategy can be beneficial for married couples with less than $250,000 in non-primary residence assets because it can increase the amount of assets they can keep when applying. 

  • Testamentary Trust for Spouse (Married Only)
    A married couple can create a trust under their will for the benefit of their surviving spouse known as a Testamentary Trust for Spouse.  If properly drafted, the assets in this type of trust are not counted against the surviving spouse when applying for Medicaid.

  • Irrevocable Income Only Trust
    Dynasty Trust (Single or Married).  This type of trust is typically used to transfer assets to beneficiaries upon death while reserving the right to receive income during life.  If properly designed, the trust principal will not be counted as an asset, but there will likely be a transfer penalty if the transfer occurs during the five-year look back period before applying for Medicaid.

CRISIS PLANNING STRATEGIES

If the applicant is already in a nursing home and the need for Medicaid is imminent, our attorneys may employ one of the following strategies:

  • Spend Down Excess Assets (Married or Single)

    This may include paying for qualifying items or services which the applicant will benefit from later such as paying off credit card or mortgage debt, making funeral arrangements, repairing the home or paying for legal services to assist in the Medicaid application process.

  • Convert Countable Assets to Exempt Assets (Married or Single)

    This strategy may include using excess countable assets to purchase an exempt asset such as purchasing an exempt qualifying annuity or promissory note.

  • Petition the Probate Court (Married or Single)

    This type of strategy can involve petitioning the Probate Court to enter an order for the protection of the applicant or the applicant’s dependents. This strategy can be used to protect income and assets.

  • Half-a-loaf (Single Only)

    This involves making a gift of approximately half of the applicant’s assets and converting the other half to an income stream to pay for care during the resulting penalty period. This typically allows the applicant’s family to protect half or more of the applicant’s assets.

  • Ladybird Deed (Single or Married)

    A ladybird deed allows the property owner to retain ownership of their primary residence for life and designate a beneficiary on death thereby avoiding probate. This exempts the property when applying and avoids Estate Recovery.

Contact us today and schedule an appointment with one of our Medicaid planning attorneys in Warren.

We offer in-person, virtual and telephone appointments for your convenience.