We are going to look at a time sensitive matter related to Medicaid eligibility in this post. But before we explain it, we will provide some background information so you know why Medicaid should be on your radar.
A lot of people are not aware of a very inconvenient truth that can potentially destroy your legacy, and it revolves around a Medicare.
If you work and pay taxes, you earn retirement credits that lead to future Medicare eligibility. The maximum accrual is four credits each year, and all people that work consistently throughout the year get the four credits because the income requirement is modest.
After you have at least 40 credits, you will qualify for Medicare, you will also be eligible for Social Security when you reach the age of eligibility. This can lead to false a sense of security with regard to medical bills that you will incur late in your life.
Gap in the Coverage
Medicare coverage is solid for the most part, but there is one gaping hole that can put you in a bad situation. The program will not pay for a stay in a nursing home, and it does not cover in-home care that is provided by a professional home health aide.
Paying out-of-pocket is certainly a possibility, but you are looking at some big dollars. In Manhattan, you can expect to pay over $150,000 for a private room in a nursing home, and the costs may be higher years from now.
For a home health aide, the median annual charge in 2020 was just under $60,000 according to Genworth Financial. The costs can be considerable for one person that needs living assistance, and they can be doubled for married couples.
Now that we have set the stage appropriately, we can start to narrow our focus and address the subject at hand. Medicaid may be relevant to you as a senior citizen because it will cover long-term care costs if you can gain eligibility.
There is a $15,900 asset limit in New York, and this is not a lot of money in the big picture. However, we do get a break in our state because it is no more than $2000 in any other state.
There is also a Community Medicaid program that will pay for in-home care. If you can get the care that you need in your own home, you can enjoy familiar surroundings, so this is much more appealing to many people.
You can give away assets to your loved ones or establish an irrevocable trust to get assets out of your name so you can qualify for Medicaid. However, you have to act in light of the five-year look back period.
The divestitures must be completed at least five years before you submit your application for Medicaid coverage. If you violate the rule, your eligibility will be delayed by a period of time that is tied to the cost of long-term care and the amount of the divestitures.
Simply put, if you give away enough to pay for one year in a nursing home, your eligibility would be delayed for one year.
Until recently, there was no look back at all for the Community Medicaid benefit. However, a 30-month look back period has now been installed. It should have already been in effect, but the date has been pushed back because of a provision contained in the Families First Cares Act.
As it stands right now, the 30-month look back period for Community Medicaid will begin on January 1, 2022. If you think that you can qualify, you have a limited window of opportunity, so you should act sooner rather than later.
Take Action Today!
We can help you gain eligibility for the Community Medicaid program if this is of interest to you, and we can also work with you to develop a custom crafted estate plan.
If you are ready to get started, you can call us at 212-973-0100 to schedule a consultation appointment, and you can fill out our contact form if you would rather send us a message.
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- NY Community Medicaid Program Can Facilitate In-Home Care - March 6, 2023