Legal-Ease: The best of times, the worst of times
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Frequently I may sound like an enemy of the Medicaid system of paying for nursing home care. Actually, that's not so.
Medicaid, as we have known it since 1966, has created "the best of times" for those who need long-term care. Without it, virtually everyone in a nursing home would be destitute, and nursing homes would still be the dark, depressing places they used to be when there was no funding but the residents' to pay for the care they provided. The advent of the bright, modern, cheery nursing facilities began with Medicaid.
The program is a God-send for those needing nursing home care. The Medicaid law really has a financial heart; it does not require family impoverishment before getting Medicaid. The shortcoming of the system (which creates the way I make my living) is that it is hard to learn what the law permits, and harder yet to properly utilize what the law permits.
Let's look at some of the misconceptions of what the law demands and what, with proper planning, the law actually allows:
Myth: You have to spend all of your money paying for nursing home care before you can qualify for Medicaid.
Fact: By carefully following the Medicaid rules, you can keep substantial assets and money and get Medicaid. People I've worked with have saved as much as several hundred thousand dollars of life savings and received Medicaid.
Myth: Medicaid will take your home.
Fact: You need not lose your home to Medicaid. If you are married, Medicaid will not touch your home as long as your spouse lives there. In West Virginia, you may keep your home for the rest of your life, even if you are single. One of the important steps in the Medicaid plans I help people design includes protecting the home so it never has to be used to pay for your nursing home care and Medicaid can't reach it to recoup its money after you die.
Myth: Medicaid will take my car.
Fact: Medicaid will allow you to keep a car of any value. You can even get a new car for your spouse to drive. The rules allow you to arrange the ownership of the car so that Medicaid can't reach it to recoup its money after you die.
Myth: All of our assets are in my husband's name and I will be penniless when he goes to the nursing home.
Fact: Medicaid allows a spouse who is still at home to keep one-half of the couple's assets as her nest egg for the future. If her half is less than $32,532, she can keep at least $32,532 even if that amount is more than half. There is a ceiling of $162,66 on her half. Many of my clients are able to use a technique which will enable a spouse whose half is less than the ceiling actually to increase her half to the maximum ceiling amount.
Myth: Once the at-home spouse's share is sorted out, all the rest of the couple's life savings have to be paid to the nursing home before becoming "poor enough" for Medicaid.
Fact: We routinely rearrange the life savings attributed to the spouse in the nursing home so that spouse at home can keep them, and by doing so, we make the spouse in the nursing home "poor enough" for Medicaid.
The saddest cases I encounter are the folks who call me after they have spent their life savings paying for care and then want to know what to do. Big as its heart is, Medicaid will not give back the money folks spent on their nursing home care that they could have saved, if they had just known how to do it.
Medicaid expects those who plan to abide by the law, which is complex.
Penalties for violating the law are severe and, under certain circumstances, may be criminal. Nevertheless, even though we must comply strictly with the law, we don't have to pay any more than the law requires. Congress and the state made the rules; as long as the planning game is played according to their rules, no more is expected. In this field, knowing what the law requires and allows is essential. Medicaid planning is not a "do-it-yourself" undertaking. You will need an experienced guide.
When facing nursing home care, seek competent help before it is too late; pay only what the law requires. After all, it's your life savings you are saving! Then, you or your spouse and family can enjoy "the best of times."
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Gerald W. Townsend is a partner in the law firm of Fluharty & Townsend, with offices in Parkersburg. His practice focuses on elder law, meeting the legal needs of seniors in West Virginia with special emphasis upon nursing home Medicaid planning. He welcomes West Virginia clients with elder law concerns, either by direct appointment or by referral from other professionals. He can be reached at jtownsend@fntlawoffices.com.