Medicaid planning is a part of long-term care planning. Many people over age 65 will need long-term care at some point, and the costs of this type of care are very high. Everyone should include long-term care planning in their estate plan.
The good news is that Medicaid will help pay for long-term care in some cases. However, there are strict asset and income limitations. Medicaid planning involves preserving as many assets as possible while still qualifying for Medicaid.
Medicaid Eligibility in North Carolina
Many people think that they will never be able to qualify for Medicaid. The asset limits for an individual are $2,000, so most people with home equity or a retirement account would easily exceed this threshold.
Fortunately, not all assets are counted for the purposes of determining Medicaid eligibility. There are several exemption amounts for different types of assets, including your home and car.
If you’re married, your spouse is also permitted to have certain assets. Medicaid planning often requires considering the interest of both spouses. One spouse is trying to qualify for Medicaid to get their long-term care paid for, while the other is still living at home and wants to maintain their lifestyle.
Avoid Medicaid Planning Mistakes
The rules involving Medicaid eligibility are complex. You can’t just transfer all of your assets to a relative in order to qualify. There is a look-back period, and any transfers made during the look-back period may subject to a penalty.
The best way to develop a good Medicaid eligibility plan is to consult with an estate planning attorney before you need long-term care. You’ll have more options if you start early and plan ahead.
Long-term care insurance may also be a good option. However, this doesn’t always cover all of your costs.
Long-term care costs are a concern for many people. They don’t want their long-term care costs to eat up all of the wealth they’ve spent a lifetime working for.
Make sure long-term care planning is part of your estate plan. Consult with your attorney to find out if Medicaid planning should be part of your long-term financial strategy.
King Law handles estate planning matters in North and South Carolina, including wills, trusts, and Medicaid planning. Follow us on Facebook for more information and updates on legal issues.