Medicaid is a joint federal and state health care program that has strict eligibility guidelines regarding an applicant’s income and assets; it is also one of the most common ways to pay for long-term care. If you need long-term care and you have too many assets to qualify for Medicaid, you may need to look for a way to reduce your countable assets for the purposes of Medicaid eligibility determinations without running afoul of the numerous Medicaid rules and regulations. In this situation, you will need to pay for long-term care in another manner without Medicaid coverage until you can reduce your resources below allowable levels, which is a total of $2,000, plus any assets that are exempt under Medical regulations. This is called “spending down” your assets to a level that will allow you to have Medicaid coverage.
If you need long-term care and have a spouse who will remain at home, who is referred to as the “community spouse,” you may want to use an annuity to help spend down resources for Medicaid purposes. An annuity changes an asset into monthly income for its owner or another designated person. In this situation, you could use an asset, such as a sum of money or a bank account, to purchase an annuity that is payable to your spouse, who is remaining at home. As long as the annuity meets certain requirements, it becomes the income of the community spouse, and therefore no longer interferes with your Medicaid eligibility.
In order to avoid any impact on your Medicaid eligibility, annuity payments must be completed within the community spouse’s life expectancy. The community spouse should purchase a single-premium immediate annuity (SPIA), which means that he or she uses a lump sum of money to pay a single premium, and the annuity immediately begins paying back the annuity premium to him or her. This type of annuity does not violate Medicaid regulations because the assets in question were exchanged for the annuity, which is equal to the value of the assets.
Medicaid rules and regulations are extremely complex and ever-changing, which means that you will need to consult with an experienced Medicaid planning attorney in order to ensure that you will be able to pay for the costs of long-term care. Aside from paying for long-term care, there are countless situations that can lead to abuse or neglect by caregivers. If you or a loved one is injured in any way as a result of elder abuse, or your family has suffered the loss of a loved one due to negligence by a nursing home or assisted living facility staff, you may be entitled to compensation. This inquiry involves determining which party or entity was at fault for the accident, acted negligently, or otherwise caused the incident that led to your injuries or your loved one’s death. At Boller & Vaughan, our Madison assisted living facility and nursing home elder abuse lawyers can help you with these determinations, and support you through any personal injury or wrongful death claims that you may have. Please contact us today for your free consultation.