Protecting Your Assets

Brackens says it’s important to plan as if you’re going to live for a long time. This is especially true if you’re seeking government entitlements such as Medicaid. Assisted living or nursing home costs could eat away at your retirement savings and other assets if measures aren’t taken to protect them.

Key strategies to help you prepare for eldercare:

Understand Medicaid eligibility. When people have assets to cover their medical expenses, the government expects them to use up their own money first. Once those assets are exhausted, Medicaid covers the rest. According to the National Clearinghouse for Long-Term Care Information, Medicaid covers medical care and long-term care services, including those provided in nursing home facilities. Assisted-living facilities do not, however, accept Medicaid. Financial eligibility requirements for Medicaid vary by state, but the cap is generally set at the poverty guideline, which for 2012 is $11,170 for one person (in most states). The government includes the following income sources: Social Security payments, Veterans benefits, pensions, salaries, wages, and interest from bank accounts. Lori Anne Douglass, partner at the New York-based law firm Moses and Singer L.L.P., recommends hiring an elder law attorney who will represent your interests and help you save money. Many people try to spend down their money or transfer their assets to loved ones, but later find that they’re still not eligible. In all 50 states, Medicaid requires applicants to turn over five years of financial records. In some states, such as New York, applicants must account for every transfer greater than $1,000.

Hire an elder law attorney. “What elder law attorneys do for the most part is help the elderly prepare the medical and financial directives they need,” says Douglass. “Medicaid pays for long-term care, but applicants must meet the financial requirements to receive assistance.” Trying to become Medicaid eligible on your own could backfire. Check with the National Academy of Elder Law Attorneys (www.naela.org). Also enlist the aid of an estate planning attorney. Contact the American Academy of Estate Planning Attorneys (www.aaepa.com).

Use trusts to protect assets. A trust legally protects and holds a person’s assets, usually for a beneficiary. Trusts have nothing to do with how much money someone has. You must use a trust that is specifically Medicaid eligible. “If someone just sets up an irrevocable trust and transfers assets, it might have benefits for estate planning purposes,” says Douglass. “But if that part is done incorrectly, your Medicaid eligibility can be adversely affected.” She recommends working with an elder law attorney who will protect your assets and assist you in becoming Medicaid eligible.

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  • Ms Iaries Thomas

    I am seeking financial credit counseling due to identity theft in 2001, lots of tuition debt & past medical bills living in fear without health insurance. I’m 43 with 3 kids non-support and disability rep widow for SSI income. Making me well depressed with out employment. when that run out i am left with college skills and training and no job due to no one are giving me a chance. I resign from teaching 2006 end-up stopping each career choice to respond to family personal crisis of supernatural and spiritual choices in my life. I was less fortunate with a dreadful 7 year moaning of fiancee’ & parents dying in the years, 2000-2006. In these circumstances got alot of heavy burdens on me for quite some time. I resign from teaching been to college, now that I had a child after 40, went through medical issue and overcame my maternity challenges. Nothing ever done in my life show my perserverance but i still carry faith i will be out of debt and a independent mom to support my family. I relize economy has cause a crutch for everyone especially single moms in the minority section. I am drowning in stress at times but God catches me revaluate my thoughts. without god my day will turn soar and I onday want Tyler Perry to read my book and publish it before He the Almighty comes to me in my sleep like my mother in peace; not pain from what earth or nation adding to our downfall of are American dream & Hope that we were promised years ago!