Medicaid used to be simple. The home or family farm was a protected asset. Sure, you may have had to spend down nearly every last dime, but at least your little slice of the American Dream was protected.
But times have changed.
In an effort to get more funds to fuel the Medicaid system, the patient’s principal residence is no longer the sacred cow it always had been.
Medicaid now puts a cap on how much equity you can have in your home and still qualify for care. The cap requires the patient to use one of several strategies to minimize the equity and still qualify for care.
And even if Medicaid lets you keep the house, it may only be a false illusion. In several states, if you are unable to return home the state puts a lien on your home for the amount of Medicaid benefits you’ve received. Some states are authorized to pursue claims against your estate to take the value of the home or family farm before it can be inherited by your loved ones.
To help make sure it goes through probate so the state can make its claim (even in states that don’t pursue a claim against the house), Medicaid considers your house an unprotected asset available for the spend down if you’ve put it in a living trust to avoid probate. When the average person gets a trust-based estate plan with the hopes of avoiding probate, they rarely understand that they’ve now exposed themselves to an even bigger Medicaid spend down.
Fortunately, there are several advanced techniques to deal with even the most restrictive estate recovery rules that threaten your home or family farm. Our team of skilled professionals can help you avoid common mistakes that could cause you to have to spend down your home or lose it to estate recovery.
Call us or email us to find out more about how we can help you protect your home!
