In our last post, we began speaking about the importance of nursing home planning. As we noted, failure to take time to do such planning can end with medical care depleting one’s estate, forcing beneficiaries to sell property to cover costs, and spoiling one’s other estate plans.
Nursing home planning is not the same as, but is closely connected to Medicaid planning. Nursing home planning, in addition to the suggestions made last time, includes finding ways to decrease the costs of care to the patient or preserve their wealth.
As we mentioned last time, one way to reduce the high costs of care is to purchase long term care insurance. This can be an investment, but one that is well worth it for those who are healthy and young enough to qualify. Those who don’t qualify need to look for alternatives, and this is where Medicaid comes in.
In Georgia, Medicaid eligibility is determined by one’s income and needs. Those who hope to qualify because of their need for nursing home care must meet certain asset requirements. There are penalties, as we mentioned, for transferring assets within a certain time frame, though there are exceptions to the transfer rules.
Avoiding transfer penalties is a large part of Medicaid planning, as we mentioned last time, and properly timed gifting plays a large role here. Knowing when to execute this gifting, how to structure it, and of course who to give to, is easier with the help of an experienced attorney, and anybody involved in this process does well to consult one.
Source: USA Today, “Ask Matt: How to protect assets from nursing home costs,” Matt Krantz, September 17, 2012