Frequently Asked Questions About Medicaid & Nursing Home Planning

1. What is the average cost of Nursing Home Care?

Answer: The average cost varies from state to state but with room & board, medication, etc., it can easily run over $6,000 per month ($72,000 per year).

2. Doesn't Medicare pay for long-term care in a nursing home?

Answer: The first thing to remember is that Medicare will only pay for "Skilled" care in the nursing home. Skilled care is the highest level of care generally preformed by physicians, registered nurses, etc. Most care provided in a nursing home is "Custodial" care, meaning assistance with "Activities Of Daily Living" such as bathing, eating, toileting, dressing, walking, bladder and bowel control, taking medications, etc. Medicare pays nothing for the cost of custodial care. Medicare will pay for 100 days of skilled care. However, Medicare only pays 100% of the cost for the first 20 days of "Skilled Care". For the next 80 days of Skilled Care, Medicare only pays after the patient has first paid their daily co-payment of $128 per day (in 2008). If you have Medicare Supplement Health Insurance, it will pay the co-payment of$128 per day. But Remember, if at any time during the 100 day period, the care you are receiving stops being "Skilled Care" and becomes only "Custodial Care", neither Medicare or your Medicare Supplement will pay for the care. If that happens you will be on your own and will have to private pay until you can qualify for some assistance in paying for Long Term Care.

3. How many "Countable Resources" can a "Single Person" have and still qualify for Medicaid nursing home assistance?

Answer: Generally speaking, if a single person has more than $1,500 of "Countable Resources" he/she will not qualify for Medicaid unless they inform themselves about the Medicaid Rules and engage in some Medicaid Planning.

4. How many "Countable Resources" can "A Couple" have and still qualify for Medicaid nursing home assistance?

Answer: Generally speaking, the spouse at home (called the "Community Spouse") can retain one-half of the couple's "Countable Resources" up to a maximum of $104,400 in 2008. The other one-half, or all amounts in excess of $104,400, would have to be spent or repositioned into "Exempt Resources" before the "Nursing Home Spouse" can qualify for Medicaid.

5. If a single person or a couple have too many Countable Resources to qualify for Medicaid, must they spend all of their excess Countable Resources on nursing home care before they can qualify for Medicaid?

Answer: No. Depending on the circumstances of each case, there are Medicaid planning strategies that can be utilized so that some (and sometimes all) of the excess Countable Resources can be protected and still qualify for Medicaid.

6. Is it true that I can't do anything with my assets, including making gifts, within 5 years of applying for Medicaid?

Answer: No. While it is true that Medicaid will inquire about any gifts or transfers of assets within 5 years of applying for Medicaid, and may impose a transfer penalty for assets given away, generally, with proper Medicaid planning, some gifting and transfers of assets can be made.

7. If a person is already in the nursing home, is it too late to do Medicaid planning?

Answer: Definitely not! One always has the option of doing Medicaid planning to legally qualify for assistance at the earliest possible time while protecting as many assets as the law permits.

8. Will Medicaid take my/our home if we/I go on Medicaid?

Answer: No. The home is an "Exempt Resource" so long as the "Community Spouse" is living there. For a single person, the home is exempt so long as there is a possibility the person may be able to come back home. If the person can not come back home, then the home, in order to keep Medicaid eligibility, will have to be offered for sale or rent. If the home can be sold, some of the proceeds can still be protected.

9. Will all of my property and income be turned over to the Nursing Home or to Medicaid if I go on Medicaid?

Answer: No. Nothing is automatically turned over to Medicaid or the Nursing Home. Once Medicaid qualification is obtained, part of the "Nursing Home Spouse' s" income will have to be applied to the nursing home bill and Medicaid will pay the rest. None of the "Community Spouse's" income is required to be paid for the "Nursing Home Spouse's" nursing home bill.

10. If I have received Medicaid benefits during my lifetime, will Medicaid take all of my estate when I die?

Answer: While it is true that Medicaid can make a claim against the estate of a Medicaid recipient, generally, in the process of Medicaid Planning the Medicaid recipient's estate will be below $1 ,500 anyway. It is also important to recognize that Medicaid pays only about 66% of what a "Private Pay Patient" would pay, so the amount Medicaid can claim against the estate is going to be less than what you would have paid if you forgo Medicaid and just paid privately until all of your assets were gone.

11. As the healthy female spouse, my monthly income from social security is small. My husband gets more social security and also gets a pension. If my husband goes on Medicaid will I lose all of his monthly income to the Nursing Home?

Answer: No. The Medicaid law permits enough of the "Nursing Home Spouse's" monthly income to be given to the Community Spouse so the Community Spouse has a monthly income between $1,712 and $2,610 (in 2008) depending on the expenses of the Community Spouse.

REMEMBER, with proper legal planning, the Medicaid applicant has many options available to preserve personal property and real estate for his or her future needs or the protection of his / her family. An attorney with expertise in Medicaid law can assist you in planning for the expenses of long term care as well as planning for the protection of resources for you and your family.