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What is Medicaid Planning, and Why Do I Need to Protect My Assets?
Age is a sign of perseverance. Few people make it to retirement without having worked hard or survived great difficulties. Our society’s elderly deserve our respect, admiration, and support. This is one of the reasons why Medicare was created. Medicare is a federal health insurance program for individuals over 65, as well as Americans with certain disabilities.
Many individuals may be counting on Medicare to help pay for their medical needs in old age. However, Medicare does not pay for long-term care in Connecticut. This includes retirement homes. However, individuals may also qualify for Medicaid to help pay for expenses.
Medicaid is a joint federal and state program that helps pay medical costs for people with limited income. It is also known as HUSKY in Connecticut. In many cases, it is a valuable resource for elderly individuals to help pay for their medical care. Because Medicaid was created to help individuals with limited financial means, applicants must meet specific financial requirements to apply. In some cases, applicants may not have enough resources to pay for their medical needs but too many resources to qualify for Medicaid. However, through proper management, an individual can still qualify for Medicaid by managing their assets properly. This is why if you or a loved one need to qualify for both Medicare and Medicaid, you must consult an experienced attorney. An experienced elder law attorney will be able to help you keep your assets while also being able to pay for medical care.
How Do I Qualify for Medicaid?
In Connecticut, Medicaid is also known as HUSKY and is divided into different programs. Each program is designated with a letter of the alphabet and is meant to help a different group of individuals. HUSKY C is the Connecticut Medicaid program for individuals over 65.
An individual must meet specific eligibility requirements to receive benefits through HUSKY C. These requirements include but are not necessarily limited to having income below a certain level and assets worth less than a certain amount. As of 2024, the income limits were $803 monthly for single individuals or $1090 for married couples. Asset levels were $1,600 for individuals and $2,400 for a married couple. Certain assets are exempt from consideration when making an asset determination. These include but may not necessarily be limited to:
- An Individual’s Primary Residence
- One Car Per Household
- Certain Burial Expenses
- Certain Life Insurance Policies
- Certain Personal Property
Many individuals are frustrated to discover themselves in a rock and a hard place. They do not have enough money to afford medical care, but they are “worth too much” to qualify for assistance. Despite these concerns, most people do not know there are legal ways to still qualify for Medicaid. One of the most effective strategies is a Medicaid Asset Protection Trust.
What is a Medicaid Asset Protection Trust?
A Medicaid Asset Protection Trust is a type of trust. A trust is a kind of legal arrangement. A person called a guarantor establishes a legal relationship with another person called a trustee. The guarantor transfers ownership of certain assets into the trust, which is managed by the trustee. At a designated time, the trustee can distribute the assets in the trust as laid out according to the wishes of the guarantor.
Assets in a Medicaid Asset Protection Trust (MAPT) are not considered when determining Medicaid eligibility. This means an individual can transfer ownership of their assets to a trusted individual for safekeeping and still qualify. The trustee can then disperse the assets as the guarantor instructs, such as upon the guarantor’s death. Another benefit of a MAPT is that it can safeguard certain assets after a person is gone.
Under certain circumstances, Medicaid reserves the right to recover funds paid on a deceased individual’s behalf. This means they can attempt to seize certain assets after an individual has died. However, assets in a Medicaid Asset Protection Trust can be safeguarded from these seizures.
When Should I Set Up a Medicaid Asset Protection Trust?
Anyone even considering a Medicaid Asset Protection Trust should begin planning for one as soon as possible. Individuals applying for Medicaid are subject to what is called a “Look-Back Period.” This period is usually five years prior to the date of application. Medicaid can review an individual’s financial records, transactions, and assets during the Look Back Period.
If Medicaid sees that an individual transferred assets, made large gifts, etc., during the Look Back Period, they can impose a Penalty Period.
Individuals must wait for the Penalty Period to expire before they can receive any benefits. This is true even if their financial circumstances at the time of application would have otherwise qualified them for Medicaid. This is why if you or a loved one is considering a MAPT, you should contact an experienced attorney. An elder law attorney will be able to help establish a MAPT outside of the Look Back Period and protect your assets.
What Should I Do if I Or a Loved One Need a Medicaid Asset Protection Trust?
Medicaid is an incredibly complex program that many people find difficult to navigate. Establishing and managing trusts can make an already complicated situation seem more difficult. Older adults should enjoy their golden years, relax, spend time with their families, and pursue their dreams. No one should spend old age worrying about money and health care. If you or a loved one are considering applying for Medicaid, contact The Law Offices Of Ericson, Scalise & Mangan, PC, today at 860-854-3809.
At The Law Offices Of Ericson, Scalise & Mangan, PC, our attorneys pride themselves on their empathy and experience. We’ve been serving the State of Connecticut since 1945, and during those eighty years, we’ve established a reputation for dedication and excellence that’s carried us into the 21st century. Our attorneys don’t consider any legal case too complex; in fact, the more complicated it may seem, the more excited we are by the challenge.
Your age and health are two things you should never gamble with. That’s precisely what many people do when trying to apply for Medicaid or establish MAPTs themselves. If you or a loved one are considering applying for Medicaid or need to set up a MAPT, call The Law Offices Of Ericson, Scalise & Mangan, PC, today at 860-854-3809 to schedule your consultation. We’ll make sure your golden years don’t tarnish.
