Nebraska Medicaid Planning

The Problem:

With the well-publicized aging of the Baby Boomer generation, the prohibitive cost of long-term care has become a critical issue for middle class seniors and their families. The Department of Health and Human Services estimates that 70% of all people over age 65 will eventually need some sort of long-term care. Currently, about 1.5 million people enter nursing homes each year.

Sadly, many seniors are unprepared for the significant financial burdens it places on them and their family. Nebraska and Iowa are much less expensive than the national averages (ranked #44 and #45 respectively), according to a 2012 MetLife survey.  Nevertheless, even in Nebraska and Iowa, nursing care averages more than $65,000 per year in Iowa and close to $70,000 per year in Nebraska. The nicest facilities in Omaha tend to run $7,000 to $10,000 per month.

 

How Do Most People Pay for Nursing Home Care?

There are a variety of ways that people pay for long-term care:

  • You might purchase long-term care insurance to cover the costs.  However, many people don’t have that insurance, and it is most affordable when purchased while you are still young.  If you wait too long, the costs become prohibitive.
  • About 25% of the current nursing home population pays with private funds; either their own or family resources. But at the rates listed above, it doesn’t take long to use up a lifetime of savings.
  • Most current nursing home residents are paying partially with private funds, with the balance being paid by Medicaid benefits, distributed by the State’s Department of Health and Human Services.
 

Medicaid Eligibility:

To receive Medicaid benefits, a resident must qualify.  Medicaid is a joint federal-state program that provides medical assistance to low-income individuals, including those who are 65 or older, disabled or blind. Medicaid is the single largest payer of nursing home bills in America and serves as the option of last resort for people who have no other way to finance their long-term care. Although Medicaid eligibility rules vary from state to state, federal minimum standards and guidelines must be observed.

Medicaid rules are complex and involve a variety of regulations.  It’s easy to get lost in the maze of terms like “look-back periods”, “exempt assets”, “income caps”, “transfer penalties”, “spend down requirements”, and “waiting periods”.  And, like most government programs, the rules change constantly.

Proactive Medicaid Planning:

Our attorneys who practice in Medicaid planning routinely assist clients with proactive planning, by developing a long-term plan which seeks to protect assets through traditional estate planning tools such as trusts, as well as a variety of asset protection tools such as life estates, Medicaid Asset Protection Trusts, etc. while coordinating private long-term care insurance, veterans’ benefits, and other resources which may be available to pay for care, without draining all the family’s assets.

 

Crisis Medicaid Planning:

Even if you haven’t pre-planned for Medicaid eligibility, and are taken by surprise with the need for nursing home care, there are still several ways that we might be able to help you obtain eligibility. Facing the challenge of becoming qualified for Medicaid benefits in a crisis, adds a phenomenal amount of stress during an already difficult time. Our firm routinely assists clients who are just starting the process and need to qualify immediately. In these situations, we work directly with clients, caregivers, social workers, care facilities, and healthcare providers to identify the best environment for your ongoing care. We work with you to complete the Medicaid application, and when necessary, design methods to “spend down to qualify” in a meaningful way, which won’t waste your hard-earned savings, but will instead benefit both you and your loved ones to the greatest extent possible. Even without a pre-existing Medicaid Plan, we are often able to preserve approximately 50% of an individual’s assets if they must enter a nursing home.

 

Our Medicaid Planning Services and Process:

To begin with, we ask you to provide a wide variety of information that will be required for us to calculate your Medicaid eligibility.  It will include such things as your specific family needs and concerns, your health needs, your income and assets, your medical expenses, your Veteran status, your spouse’s situation if married, past transfers to others for less than fair market value, and much more.

Once we have all the information, we will analyze your situation, and issue a Comprehensive Medicaid Asset Protection Strategy Plan.  Our strategy will explain the Medicaid rules, and discuss every available planning option that you might use. While there may be dozens of optional strategies, we’ll recommend those that we think will best serve to provide for your needs while also meeting your goals for your family and assets.

Next, after you’ve decided which strategies you’d like to use, we help you execute the plan that has been developed. It could involve one strategy or several. When the timing is right based on your chosen strategies, we will assist in the preparation of the Medicaid application materials and follow up with the appropriate administrative agencies, such as the Nebraska or Iowa Health and Human Services departments. We will assist with any hearings that might be required, and will file the annual renewal to keep your Medicaid benefits flowing.

If you’re married, there is good news for the spouse who is remaining at home (called the “community spouse”). You can keep your home, car, and household furnishings, along with a substantial amount of assets and income; even while your spouse is receiving Medicaid benefits for his or her nursing home care. You simply need the help of a professional planner to accomplish it.

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