Avoiding the Medicaid Clawback
If you believe you will need long-term care in the future, you might be worried about how you will pay for it. Fortunately, you have many options for this including your savings, long-term care insurance you have previously purchased, and Medicaid. Medicaid is a needs(?)-based government program, where you can only receive benefits if you have a low income and/or, limited assets. If you attempt to give away your assets or income to qualify for Medicaid, this may disqualify your benefits for a certain period of time. Below, our Boca Raton Medicaid lawyer explains how to protect yourself and your assets from the Medicaid clawback.
An Asset Protection Trust
An asset protection trust can protect your wealth by transferring assets to family members, but there are some drawbacks to using this strategy. Asset protection trusts allow your assets to be distributed to the same beneficiaries when you pass away so that your loved ones are not liable for paying capital gains taxes on the appreciation of the assets during your lifetime. Any assets you transfer to an asset protection trust no longer legally belong to you. These transfers are also considered as part of Medicaid’s “look-back period,” so it is important to plan in advance.
An Income Trust
There is a limit on your income when you apply for Medicaid and it is very strict. If your income is above these limits, you must plan accordingly so that you can continue to be eligible for Medicaid. One solution to this problem is to establish a Pooled Income or Qualified Income Trust. Qualified Income Trusts are created to hold income that is in excess of the Medicaid limits. These Trusts are irrevocable.
Pooled Income Trusts are also irrevocable and can hold excess income. These trusts are intended for people suffering from a disability. These funds are managed by a non-profit agency. The excess income is pooled with that of other disabled individuals and disbursed to those in the pool.
Creating a caregiver contract is an effective way to obtain services that are not covered by Medicaid. These contracts stipulate that a trusted friend or family member can leave their job to care for an older individual. The services they provide are paid for in advance, which can reduce one’s income (assets?) and make them eligible for Medicaid. Caregiver agreements must be written using very specific rules,. At Samuels Wood PLLC, we ensure that the agreement is drafted properly.
Contact Our Medicaid Lawyer in Boca Raton Today
There are many ways to protect yourself from a Medicaid clawback. At Samuels Wood PLLC, our Boca Raton Medicaid lawyer can explain what they are and help you choose the legal avenue that is best for your situation. Call us now at 561-864-3371 to schedule a consultation or connect with us online to learn more about how we can help protect your future.