Everyone can be prone to procrastination sometimes! As a result, inevitably, some elders and their families will not have an opportunity to engage in any Estate Planning (Wills, Powers of Attorney, Living Wills), let alone start any Advance Asset Protection Planning. If you or your loved one is in a nursing home or think that you or they may need to go very soon, you must remember that Asset Protection Planning in a crisis (while not the best scenario at that point) is still available. However, you should be aware that the crisis planning outcome is often not as ideal as when pre-planning is done.
The goal in crisis planning is to preserve and protect as much income and assets as permissible under the law for the benefit of the elder in crisis (and their spouse if married). One of the challenges of crisis planning is overcoming the false presumption that elders and their families have that it is too late to engage in Asset Protection Planning.
Common Myths of Crisis Medicaid Planning:
(1) It is too late to do planning: False
It is never too late to preserve and protect assets! Too often, elders and their families believe that they need to spend-down all their money on the nursing home before the elder may qualify for Medicaid benefits. This misconception is why it is crucial to consult with a Certified Elder Law Attorney to see how they can help as soon as possible. One thing to keep in mind is that property must be protected either by a life estate deed or by placing it in the right type of trust, as both methods are subject to the 5 Year look-back period required by Medicaid.
(2) The nursing home will do your application for free: False
The nursing home may offer to complete the Medicaid application for free or a low fee, but, the fact is that the nursing home will require that you spend down all of your savings before they do that application for "free.” To be fair, in truth, applying for Medicaid is not a nursing home’s function. The outcome from a nursing home applying for Medicaid is not the same as what can be accomplished by actually working with a Certified Elder Law Attorney.
(3) I will never qualify for Medicaid – I have too much money: False
You cannot make an informed decision about when you might qualify for benefits until after you meet with a Certified Elder Law Attorney. The fact is that every elder deserves to know all of the facts and options before making an informed decision about their long-term care costs!
(4) Medicaid or Asset Protection Planning requires “hiding” assets or engaging in illegal acts: False
No - nothing could be further from the truth! The fact is that a Certified Elder Law Attorney will disclose all planning strategies directly to Medicaid during the application process. The planning is lawful and you have every right to take advantage of your given rights under the law. Just as folks have the right to employ a CPA to save tax dollars, elders have the right to employ attorneys to save assets in the Medicaid process.
(5) Planning is unnecessary - the nursing home covers everything: False
By shielding assets and income, we can help ensure that married clients protect their spouse at home against impoverishment. For unmarried clients, the attorney should ensure that they have rainy day funds to supplement their quality of life for the rest of their lives. The fact is that nursing homes do not cover all of the needs of the elder. Those elders and their families in nursing homes who have planned ahead enjoy a much higher quality of life than those who failed to save assets.
(6) I am already protected because Medicaid won't count the assets in my spouse's name: False!
Sadly, no - Medicaid counts assets in both your name andyour spouse's name. Likewise, most assets owned jointly with 3rd parties (adult children, for instance) are also fully countable to the elder in the Medicaid planning process. Asset Protection that yields real results requires the advice of a qualified and Certified Elder Law Attorney, as trying to protect assets yourself without the right help can have real repercussions if done incorrectly.
(7) I have no chance at all of protecting my home from Medicaid: False!
Without careful planning, Medicaid can require the sale of your home or record a lien on your home. Depending on the elder's individual circumstances, it is often possible to save the home. We work to prevent a forced sale or prevent a lien where possible. The key here is that you take action toward this as soon as possible.
Many elders and their families seek legal assistance when an elder is hospitalized or already in a nursing home for rehab or long-term care. Sometimes the elder is already paying privately for nursing home care (often more than $400 per day, which adds up quickly!). They assume wrongly that the elder must spend down their assets on private nursing home costs. With careful planning, private paying to the nursing home can be stopped after a time, protecting assets for the elder's benefit, and qualifying that elder for Medicaid to pay the nursing home costs. Contact us for more information on how we can help you and your family plan for the future!