Medicaid asset protection is a very complicated issue. Not just the common people are flummoxed by the infinite number of clauses and conditions of getting Medicaid even some legal practitioners secretly admit that it is complicated for them to handle.
There are a number of permutations and combinations. The aspect of asset is only one of the three major areas of Medicaid eligibility criteria – health and income criteria being the other two. However, it is the most complex among the three and can have a number of far-reaching consequences.
This article provides tips about the potential risks in methods of Medicaid asset protection. Before we go into the tips, it is better to understand a few basic aspects about Medicaid and what is implied by the term "Medicaid asset protection".
An Introduction To Medicaid
Medicaid is a healthcare support program that was started in 1965, jointly arranged by the federal government and the state government. The main objective of this program is to provide quality medical treatment and healthcare for people in their old age. In practical sense, the most widely used aspect about this scheme is getting free or state-sponsored treatment in nursing homes. The program has recognized certain nursing homes for this purpose and one should be willing to undergo treatment in these nursing homes to get the benefit of Medicaid program.
The Question Of Asset Protection
Methods of Medicaid protection are quite popular among lawyers and people who seek Medicaid protection. In simple terms, it refers to the legal methods that would allow a person to keep his or her assets, and still be able to get free treatment through Medicaid programs. There has been a vigorous debate about the ethical issues surrounding such legal practices. However, those issues are not elaborated here.
According to Medicaid eligibility criteria in most states, the total value of the assets, owned either by the applicant or by the spouse, should be less than $100000 (the value differs from state to state and many states revise this figure annually).
People tend to transfer their assets to their children or to a trust for enjoying the benefits of Medicaid. To prevent the benefit from going to people who are not eligible, the Medicaid eligibility conditions have a look-back clause. That is, if the assets of the applicant have been transferred to the children or relatives in the last three years or to a trust in the last five years, he or she is not eligible for Medicaid benefits.
Tips For Avoiding Risks In Methods Of Medicaid Asset Protection
Many people think about transferring their assets to their children. It should be done after careful planning and with a long-term perspective in mind. It might help one to claim Medicaid benefits after three years. However, what will happen if the children have their own ideas about the property? They can sell or mortgage the property. Worse, the attitude of the children or in-laws can change when they get the ownership of the property.
Even if the children are god-fearing and good natured, the property is at risk. Your children may suffer business losses or investment disasters. Eventually, your asset might land in the hands of the creditors. Therefore, if you mindlessly transfer assets to your children, it will be a typical case of being penny-wise, but pound-foolish.
Last, but not the least, it is better to consult a reputable attorney to figure out the pros and cons of Medicaid asset protection.
A complimentary download for you of two chapters of Attorney Frazier's book on Protecting Your Family's Assets In Florida, more in depth articles as well as a complimentary consultation for you by telephone or in person with Attorney Frazier is available now by going to
www.EstateLegalPlanning.com.
