If you are currently enjoying your retirement years, or you are the caregiver of someone who is, it is important to make sure that you are familiar with the Medicaid system. Over half of all seniors depend on Medicaid to pay for in-home or long-term care facility care. The Medicaid eligibility rules are complex and often confusing. One thing is certain; asset transfers within five years prior to applying for Medicaid can cause your application to be denied. Paying a family member as a caregiver, however, may not disqualify you for Medicaid.
The high cost of in-home or long-term care means that a significant percentage of older Americans must depend on Medicaid to cover those costs. Fortunately, Medicaid will cover long-term care costs as well as in-home care in many states. However, you must first qualify for those benefits. Medicaid is a federally funded, but state administered, healthcare program. As such, the eligibility rules vary somewhat from state to state, though all states employ both an income and an asset limit that cannot be exceeded by recipients. Though most seniors on a fixed income can easily meet the income test, the asset test can be problematic since the asset limit is often very low. Simply giving away assets won’t work because Medicaid uses a five year “look-back” period that allows the program to effectively disallow any asset transfers that occurred within five years of applying for benefits.
The Medicaid rules may prohibit you from giving away assets to family members. However, you may be able to pay a family member to care for you. The State of Illinois, for example, is one of several states that participates in the “Cash and Counseling” program. Cash and Counseling allows a Medicaid recipient to manage a flexible budget that may include paying a caregiver to care for the recipient in his/her home. This, in turn, allows the senior to remain in the community much longer, thereby avoiding the need for long-term care.
Whether you are a senior yourself in need of care, or a family caregiver, it is imperative that you consult with an experienced elder law attorney to ensure that you understand the Medicaid eligibility rules as well as the rules applicable to paying a family caregiver. Utilizing the paid family caregiver option can solve a variety of potential financial issues for everyone involved; however, one wrong step could cause a Medicaid recipient to lose eligibility
If you have additional questions or concerns about Medicaid planning, or other elder law issues, contact the experienced Illinois elder law attorneys at Nash, Nash, Bean & Ford, LLP by calling 309-944-2188 to schedule your appointment today.