As a lawyer, my clients often exchange rumors that they are spreading “on the streets” on all kinds of legal issues. I give them credit for bringing these rumors because it gives me a chance to set them straight, and it gives them the opportunity to get the right advice and do the right things. Because my practice is related to the older law, the most common rumors I hear are Medicaid. They are also the most unpleasant. I am amazed at the misinformation that circulates so recklessly.
The biggest hearing about Medicaid, with which my clients have shared with me, includes what to do if a parent suddenly becomes seriously ill, they have no long-term care insurance, they have not done Medicaid pre-planning, and they need Medicaid to pay for permanent home elderly care. More than one client told me that friends and acquaintances advised them to put all of their parent assets in their own name, because then Medicaid would see that they had nothing and they could claim the Medicaid right away.
WRONG!
Not only wrong, but also full of problems that can punish the needy and their families, disqualification or, even worse, criminal charges.
Regardless of whether a helpless senior citizen will immediately apply for Medicaid to pay for pre-school care, it depends on whether they have progress in planning Medicaid or whether their current financial situation qualifies them on the street. Really disadvantaged should not have problems. This is a lower middle class — those who have modest assets that they try not to lose completely, especially if they have a good spouse or children — who face a more difficult task in order to qualify.
Congress has created methods by which those who are not impoverished but not rich can try to protect some or all of their assets in order to qualify. At best, someone who plans well in advance can create a trusting Medicaid trust, transfer all of their assets to trust and wait for a five-year “retrospective” period. When a person can show that they have not had assets for at least five years (since the trustees of the trustees, their property and the Medicaid applicant cannot be the trustee), they should be eligible for Medicaid.
This is in the worst case - when the senior does not plan at all, or what we in the industry call the “crisis case Medicaid” - these are problems. And here all these rumors abound. Because Medicaid looks back at each individual’s financial history for five years to determine what they have (and) and where it went, any transfer of their assets to another person’s name without proper compensation for the transfer will earn Medicaid a penalty period that means that they will not qualify for coverage for a specific period of time, based on the established formula.
worst the thing a child can do is transfer their parent assets from the parent name, thinking that Medicaid will not know or not report all the assets that, according to Medicaid, they will not be found - both are equivalent to deceived Medicaid and may subject it faces criminal charges. (Different rules apply to spouses). The fact is that Medicaid carefully analyzes all applicable financial financial, reference and cross-references, checks all financial transactions, bank accounts and other assets and determines whether money has been transferred. By the time they find out, it will be too late for the elder to do what -or to cancel these transfers, and they will be disqualified from receiving Medicaid benefits for at least a period of time.
Congress sanctioned several methods by which even “crisis” cases could protect some of their assets. Some examples include the purchase of an irrevocable funeral trust, investing in certain improvements in a home, giving out debt-giving gifts, and concluding personal service contracts with family members. The only way to find out if you or your loved one can protect some or all of your assets is to advise a senior lawyer who specializes in Medicaid planning.
As my father said: "Believe half of what you see, and nothing of what you hear." This is a good policy when it comes to Medicaid rumors. Get the right advice so you can get the best for your loved ones.
