How to protect your assets from Nursing home and how to qualify for Medicaid assistance in NY

Question 1: How much do nursing homes cost?

Answer: According to a recent survey, the average length of stay in a nursing home is two and a half years. Nursing home costs average $70,000 a year, with an average cost per stay of $170,000.

Question 2: Will medicare pay for my nursing home costs?

Answer: No. Medicare does not the pay the expenses of long-term care incurred for day care at adult centers, home care by relatives or employed caretakers, and nursing home care. Medicare pays limited benefits for skilled nursing care only.

Question 3: What government program will pay for my nursing home costs?

Answer: In the United States, the government program that pays for most nursing home care is Medicaid, which is a federal and state medical program for persons who meet certain asset and income levels. Some veterans are entitled to veterans benefits to pay for their nursing home care.

Question 4: How can I avoid being impoverished by the high cost of nursing home care?

Answer: The answer usually depends upon your marital status, and whether you are already in the nursing home or you anticipate a lengthy stay in the nursing home. It is almost never a good idea for people who aren’t facing a lengthy in the nursing home to give away assets.

Question 5: If my spouse is going into a nursing home, can he or she transfer all of his or her assets to me and qualify for Medicaid?

Answer: Probably not. To determine the eligibility of the spouse who is going into the nursing home to receive Medicaid, all of the non-exempt assets held by the husband or wife are added together and then the total divided equally between the spouses. Of the half attributed to the spouse going into the nursing home, that spouse is disqualified from receiving Medicaid until his or her share of the assets are reduced to $2000.

The spouse outside of the nursing home can retain half of otherwise non-excludible assets, up to a maximum (of around $100,000, an amount that changes annually), plus the residence, plus some personal property, plus burial reserve, plus automobile, and other miscellaneous items.

Question 6: Can I transfer my assets to my children just before I go into a nursing home and still qualify for Medicaid?

Answer: Probably not. Under the 60-month Lookback Rule, eligibility for Medicaid may be denied if the person going into the nursing home transferred assets for less than fair market value within 60 months before his application for Medicaid benefits.

And be very careful about giving away assets: once you have given away your assets, you cannot get them back by legal action. Don’t rely on your children to “do the right thing” and hold the assets for you in case you need them. See Question 11 below and our “Pitfalls of Giving Away Your Home” for some good reasons why you should not give away your assets.

Question 7: Should I use a trust to protect my assets?

Answer: Absolutely YES! Assets are usually transferred to children or other family members either outright or to a trust for your benefit. A trust can be more desirable than an outright transfer to a child because:

a) You may have a bad relationship now or in the future with:
1) your child or
2) your son-in-law or daughter-in-law
b) Your child may:
1) get divorced,
2) have creditors or go bankrupt,
3) invest your assets unwisely,
4) spend all of your assets during your life, or
5) spend all of your assets as soon as you die.

Question 8: How can I protect my house?

Answer: Put your house in a trust. The Medicaid applicant may retain a principal residence. The homestead is exempt property. After the Medicaid recipient’s death, however, the house can be sold and Medicaid reimbursed unless there is a surviving spouse. Maybe a transfer or sale of the residence to the children with the parent reserving a life estate is advisable. Although the value of the life estate might still be at risk during the applicant’s life, there are certain planning possibilities available to protect the life estate.

Question 9: Isn’t it wrong to hide assets in order to qualify for Medicaid?

Answer: Hiding assets in order to qualify for Medicaid is a crime. That’s not what elder law attorneys who help their clients become Medicaid-eligible do.It is not illegal to structure one’s assets in an effort to qualify for Medicaid nursing home benefits.

Elder law attorneys advise their clients on the Medicaid law and what can and cannot be done legally within the law. Come to Law Office of INNA Fershteyn and Associates today (718) 333-2394 and learn how to protect your assets from Nursing home and how to qualify for Medicaid assistance.