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Medicaid FAQs

  • Is Medicaid Planning legal?

A. Yes. Medicaid qualification rules have some specific planning options available and understanding how to utilize these specific planning options is just like understanding and utilizing legal tax saving strategies.

  • Will the care be sub-standard?

A. No, it is illegal to discriminate. Medicaid patients are supposed to receive the same level of care as any other patient.

  • Doesn’t Medicare pay for Long Term Care?

A. Only on a very limited basis. Medicare can sometimes cover the first 20 days of a Skilled Nursing Facility stay at 100%. Medicare can sometimes cover a small daily co-payment for days 21 through 100 and after day 100 all Medicare Skilled Nursing Facility benefits stop in most instances.

  • How do I protect my home?

A. In the State of Florida, at this time, the homestead is exempt as long as it is the applicant’s principal place of residence and has a market value of under $636,000.

  • Do I have to be destitute in order to qualify for Medicaid ICP Benefits?

A. No. There is a Community “OBRA” Legislation that protects the Community Spouse from impoverishment. Medicaid planning can help protect assets from being unnecessarily spent down. Just remember that the Medicaid applicant must pass the medical eligibility test and that the Medicaid applicant and the Community Spouse (if there is one) must pass both the income and the asset tests.

  • What if I have little (or no) income and my spouse enters a nursing home? Does Medicaid count my income? Can I have some of my spouse’s income diverted to me?

A. Incomes are looked at separately. Yes, it is possible in some circumstances to divert some of the Medicaid applicant’s income to the Community Spouse.

  • What happens if the Medicaid applicant has too much income to qualify for Medicaid – But not enough to pay for the nursing home?

A. A qualified Income Trust can be used in this instance.

  • What is a Qualified Income Trust?

A. A qualified Income Trust is a diversionary trust, which exempts all income above the income cap so that the Medicaid applicant can qualify for Medicaid ICP benefits.

  • Do I have to have a Durable Power of Attorney (DPOA) to apply for my spouse?

A. No. For Medicaid application purposes, anyone can apply for benefits on behalf of the individual experiencing the nursing home crisis. However, a DPOA is critical when making day-to-day business decisions for the individual experiencing the nursing home crisis.

  • Do I have to have a Durable Power of Attorney (DPOA) to apply for my parents or a relative?

A. No; however, it is our opinion that having a DPOA in place in advance of any long term care crisis is very important for anyone in a position to take care of a loved one’s planning needs.  For Medicaid application purposes, anyone can apply for benefits on behalf of the individual experiencing the nursing home crisis.

  • Can I gift away $12,000?

A. No. This is a common mistake between tax law and Medicaid law. Any gifts above the State average pre-payment will trigger a period of ineligibility.

  • I was told to take my spouse’s name off of everything we own. If I do so, are our assets protected?

A. Not necessarily. It is important to understand that, in general, incomes are viewed separately and assets are viewed jointly. Re-titling can be an important part of an overall plan, but it is not a solution in itself. Additionally, some sources of income cannot be re-titled.

  • Are there penalties if I transfer all of my assets to my spouse?

A. No. At this time, the law allows unlimited transfer between spouses.

  • If I transfer my assets to my spouse, is there a look back period applied?

A. No. Look back periods do not apply to transfers between spouses.

  • Can I set up a Revocable Living Trust?

A. Yes, but a Revocable Living Trust is not effective in distancing a person from their assets under current Medicaid rules, particularly if the Medicaid applicant is named as the trustee of the trust.

  • After my spouse is approved, can I gift assets away?

A. In general, the answer is yes. Once the case is approved, the Community Spouse’s assets are no longer a part of the ongoing eligibility. Gifting, however, could affect the future Medicaid eligibility of the Community Spouse.

  • What will happen if the Community Spouse should need to qualify for Medicaid ICP benefits after the Medicaid application is approved for the nursing home spouse?

A. If both spouses end up needing Medicaid ICP benefits, the income and asset limits change dramatically. This is why comprehensive planning is necessary.

  • How do I protect my assets in the event that my spouse is in a nursing home receiving Medicaid ICP benefits and I die first?

A. Once again, comprehensive planning is necessary.

  • If I choose to, may I bring my spouse home after he or she has been approved for Medicaid ICP benefits?

A. Yes

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