Older adults often take for granted that Medicare will provide them with sufficient support as they grow older. However, Medicare benefits actually have numerous noteworthy limits. Those who require long-term care or possibly skilled nursing support in their own homes as they age will learn that Medicare does not always cover such expenses.
As a result, quite a few people may need to apply for Medicaid benefits as they age. Unfortunately, the average adult does not fully understand the Medicaid program, which will likely lead them to make choices that could cost them or their loved ones thousands of dollars.
These are just two of the important details about Medicaid that the average person needs to know when putting together their estate plan.
1. Medicaid looks at years of financial records
Those applying for Medicaid in Texas don’t just apply for benefits based on their current income and financial circumstances. The application process involves a thorough review of their recent financial history.
The state will look at 60 months or five years of financial transactions. Large gifts or transfers during that time can trigger a penalty that will leave someone ineligible for Medicaid benefits for months in many cases. Only those who plan years ahead of time can avoid the penalties associated with such transfers.
2. Medicaid wants repayment for all benefits
Unlike Medicare, Medicaid is only available to those that demonstrate need. Any resources left in someone’s estate will therefore potentially be subject to estate recovery efforts. Financial accounts and personal property could be subject to claims in probate court.
In fact, even the home where someone lived could be subject to estate claims. Those that don’t plan ahead and end up needing major support in the form of long-term care coverage could end up having the state lay claim to all of the equity in their home and any other assets they thought they could pass to their beneficiaries when they die.
Estate planning often requires not just thinking about what will happen to valuable property after someone’s death but also planning for their medical support and other needs in their golden years. Thinking about Medicaid benefits and other forms of support can help people create more viable and thorough estate plans with the assistance of a legal professional.