Medicaid Planning: Definition, Costs & Types of Planners

Last updated: May 15, 2023


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 an individual’s monthly income or resources are over the financial eligibility limits. In some states, income can be converted into Qualified Income Trusts, also called Miller trusts, and in other states, persons can “spend down” their income on medical expenses via the Medically Needy Pathway. When persons have excess resources, countable resources can be converted into non-countable ones, such as an Irrevocable Funeral Trust. Many of these transactions require legal and / or financial expertise. For example, in states that do not allow seniors to convert their excess income into Miller trusts, doing so may result in Medicaid ineligibility. Furthermore, some states may allow an alternative option, such as a Pooled Income Trust.

One other major complicating factor is when one spouse requires long-term care and the other can live independently. How are their incomes and assets divided? This is a challenge many Medicaid Planners strive to overcome.

 Did You Know? Most Medicaid Planners offer free consultations. Connect with a Planner now or take a Medicaid Eligibility Test


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 from Medicaid’s Estate Recovery Program to ensure the next generation can live in a home and / or afford an education.


Types of Medicaid Planners

Assistance with Medicaid planning can come from a variety of different professionals 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 below 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


How Much Does Medicaid Planning Cost?

The cost of getting assistance for Medicaid planning ranges from free, to as much as $8,000, or even $15,000, 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. Another variable in cost is the type of service provider; Elderlaw Attorneys may charge more for the service than Specialized Medicaid Planners who are not attorneys.


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. 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.


Is Medicaid Planning Legal? Ethical?

Yes, Medicaid planning is legal. In some states, there are laws that limit who can provide legal advice on Medicaid planning, but in no states are there any laws about families engaging in Medicaid planning to qualify a loved one for their state’s Medicaid program. The ethical question is more complex and many attorneys, educators and politicians have expressed opinions on the subject, including the New York Times. It is not our position to express an opinion on this subject. The creators of this website feel it is a decision each family needs to make for themselves in the context of their financial situation and their loved one’s need for care.

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