Florida residents, especially those in need of nursing-home level of care, may be aware that Medicaid is an important payment source. Medicaid is a federal health care program that offers options for low-income individuals of any age. There are different programs, such as institutional (nursing home) Medicaid, home based Medicaid, and regular Medicaid for the aged and disabled.
Regardless of which plan one intends to use, Medicaid planning can go a long way to ensure one is eligible for the plan needed. This means those who are over the age of 65 and financially ineligible for Medicaid must find other ways to qualify.
Even if you are already in a nursing home and already receiving Medicaid, your eligibility must be maintained by staying under the income and asset limits each month. If you inherit assets, that could result in ineligibility if you do not promptly spend down or reallocate funds in the same month they are received.
The following are some of the approved methods of getting Medicaid eligible:
Qualified Income Trust
Excess income can be put into a trust by those who are seeking long-term care in a nursing home or in a community setting. Money may be deposited monthly into a qualified income trust or QIT to bring one’s income down to the income limit prescribed by Medicaid.
The legal control of the trust will be granted to a trustee and the income can only be used for specific purposes, such as medical bills and personal needs. A qualified income trust is irrevocable. The funds remaining after death of the recipient must be given to the state of Florida as partial repayment of the Medicaid lien.
A pooled trust is a way to make “excess” assets or income become not countable for Medicaid purposes. In a pooled trust, the Medicaid applicant places with the trust assets or monthly income that would otherwise disqualify the applicant with a charitable remainder trust. This trust can be tapped to fund needs of the applicant which are not covered by Medicaid or Medicare such as transportation to doctors appointments, dental/vision/hearing needs, etc. The funds remaining in the trust at the time of death will be subject to the Medicaid lien. The longer the applicant was in the nursing home on Medicaid, the less likely there will be any funds remaining after death. However, if any funds are there over and above the Medicaid lien amount, those funds can be left as the applicant requested when setting up the trust.
Natural Spend Down
Sometimes the “excess” assets can be spent down on items to benefit a Medicaid applicant. For example, the purchase of a new TV or a DVD. Or if the applicant still has a home, needed repairs or improvements for the home will help to preserve this non-countable asset in case the applicant is ever able to return home. Legal services to help you plan for eligibility are also appropriate in a Medicaid spend-down situation.
Taking care of a Spouse
IF the applicant is married, sometimes assets can be moved into the spouse’s name in order to qualify. This must be done carefully because the spouse will also have to remain under their separate asset limit. When engaging in Medicaid planning, it is important to understand how one’s income and assets play a role in eligibility. Consulting an experienced attorney maybe one way to ensure the complicated process can go smoothly