Medicaid planning can help older adults ensure that they have coverage if they require long-term care. Medicare has many limitations that may make Medicaid necessary for those in need of medical support as they age.
Many people do not have a Medicaid plan in place before benefits become necessary, which can leave them and their family members in a challenging position. They may be at risk of a penalty that delays when benefits become available or could face estate recovery efforts to repay the benefits they receive after they die.
What is the ideal time to begin planning for future Medicaid eligibility?
Planning before retirement offers optimal protection
People often start thinking about their estate plans as they prepare for retirement. Pre-retirement estate planning is an ideal time to address concerns like Medicaid planning. People who transfer assets to trusts, take on co-owners and otherwise diminish their personal resources can help ensure that they qualify quickly for Medicaid if they require benefits later. Planning should occur at least five years before submitting a Medicaid application to reduce the chances of the state imposing a lookback penalty.
There are strategies that can minimize the penalties imposed in cases where people do not plan at least five years before applying for Medicaid, but planning early in retirement or prior to significant medical decline can offer the best protection to older adults. Sitting down with an elder law attorney can help people make strategic moves that improve their eligibility for Medicaid and reduce their risk of a penalty as well as the chances of estate recovery efforts after they die.