An important aspect of estate planning involves knowing the options available in your later years. Medicaid often enters the lives of seniors when it becomes necessary to pay for nursing home care. Many people mistakenly believe that Medicare or a private health plan will cover the expense of a nursing home. This is not the case, and often they must turn to Medicaid, a federally-funded, state-run program for those with little or no resources or income.
Medicaid law is a complex and challenging set of rules and regulations that often change. A Medicaid attorney may be needed to help you through the maze of these regulations. One area in particular may impact your estate plan, and it’s known as a “look-back period.”
A look-back period represents a form of a statute of limitations; if you have made any gifts in excess of $500.00 within that period of time and (1) you are in a nursing home and (2) you apply for Medicaid because you have run out of money, Medicaid will NOT pay for your nursing home care. If you make such a gift and a certain amount of time has passed, which is five years in Ohio, you will qualify for Medicaid and your nursing home care will be paid for by Medicaid. Medicaid planning is a method that is used to allow individuals to plan for their eligibility and takes into account the look-back period.
The look-back period begins on the date the applicant is institutionalized and applies for Medicaid. A transfer made within the look-back period is deemed “proper” or “improper”, depending on the circumstances or purposes of the transfer. Improper transfers that occur during a look- back period are subject to a restricted Medicaid coverage period, meaning a penalty is assessed making the applicant ineligible for benefits during a calculated timeframe.
Obviously, Medicaid law is complex, and many families can benefit from not only from estate planning that accounts for various senior care options, but consulting with a Medicaid attorney to help them through the maze of Medicaid.