Medicaid Planning Definition
The term Medicaid planning encompasses a wide variety of services provided by an equally wide variety of professionals and volunteers. 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 or as complicated as a complete re-structuring of one’s financial assets.
Much of the complexity associated with Medicaid planning occurs when individual’s monthly income or resources are near, or over, the financial eligibility limits. Incomes can be converted into pooled income or Miller trusts and resources in excess can be converted into non-countable assets. However, these transactions require legal and financial expertise. For example, not all states allow seniors to convert their excess income into pooled income trusts, and in those states, doing so may result in Medicaid ineligibility. One other major complicating factor is when one spouse requires long-term care and the other can live independently.
Why Engage in Medicaid Planning?
In short, families engage in Medicaid planning to ensure the best possibility of acceptance into the Medicaid program. However, the motivations behind this simple answer are diverse and complicated. A sampling of reasons follows as to why one would engage in Medicaid planning.
-Long-term care is very expensive, and families want to ensure their loved one receives the care they require, which they could not otherwise afford.
-Medicaid eligibility is extremely complicated, and even simple errors can result in a denial of benefits. This can be devastating to the health and happiness of the applicant, their caregivers, and family members.
-The application and review process is time consuming. Working with a Medicaid planner can accelerate this process and save applicants unnecessary stress.
-To ensure that the healthy spouse, who lives at home, will have the financial resources to continue doing so.
-To preserve a family’s limited assets to ensure the next generation can live in a home and / or afford an education.
Who Provides Medicaid Planning Services?
Assistance with Medicaid planning can come from a variety of different professional and volunteers. The most appropriate and affordable options depends on a variety of factors such as one’s finances, age, health, state of residence and their marital and veteran status.
All of the following can provide Medicaid planning services, click on any title to learn more about the pros and cons of that specific type of assistance or use our free locator tool to find the best option for your needs.
1. Elderlaw Attorneys
2. Geriatric Care Managers
3. Eldercare Financial Planners
4. Commission-Based Medicaid Planners
5. ADRC / AAA Benefits Counselors and Case Managers
6. SHIP Counselors Volunteers
7. Insurance Agents
8. Long Term Care Ombudsmen
9. Non-Professionals / Self-Planners
What Does Medicaid Planning Cost?
The cost of getting assistance for Medicaid planning ranges from free to as much as $5,000, or even $10,000, in some areas of the United States. The cost associated with planning is typically related to the amount of income and assets an individual has and other complicating factors, such as marital status, home ownership, life insurance, and what veterans’ benefits they may be receiving.
Why One Should Plan in Advance?
One might think that if they, or a loved one, are healthy that there is no reason to move forward with contacting a Medicaid planner. However, even if one does not foresee a need for Medicaid in the near future, advance preparation is key. In fact, the best time to start preparing for long-term care needs is before an actual need arises.
Without advance preparation, many families end up paying out-of-pocket for nursing home costs, or other long-term care costs, until their assets run out. Thus, qualifying them for Medicaid. That being said, if one plans in advance, there are many notable planning opportunities in which Medicaid planners can assist. Advance preparation is the best action to help protect one’s assets, while still being able to qualify for Medicaid when the need arises.