LISTEN TO LAWRENCE
Dear clients and friends:
I hope you all had a wonderful Labor Day weekend. The weather was great and it was nice to relax for a few days. We deserved it!
BUT……Labor Day is over and it is time to get back to work. I want to take this moment to remind you about a deadline coming up. On October 1st, the law changes with regard to how you can become eligible for Community Medicaid.
Community Medicaid is Medicaid outside of a nursing home, including the very important, home care services. Obviously and especially these days, no one wants to go to a nursing home so accessing home care services becomes even more critical. To access Medicaid for home care services you have to be poor, that is you can not have more than $15,750 in your name. Until October 1st, all you have to do is transfer your money out of your name to your children, a trust or otherwise and you can become eligible for Medicaid.
However, as I have reported to you in the past, as of October 1st, there will be a 2 1/2 year look back. This means that when you apply for Medicaid, the government will look back into your financial history to see if you transferred any assets in order to be “poor enough” to obtain Medicaid. If a transfer is caught, you will be penalized, not a dollar amount but rather you will incur a penalty period in which you will not be eligible for Medicaid for a certain amount of months. While we are still looking for regulations in this area, it appears that for approximately every $13,000 you transfer out of your name, you will not be eligible for Medicaid for one month.
Let me give you an example: if you transfer $130,000 out of your name on or after October 1st and then apply for Medicaid, you will not be eligible for Medicaid for 10 months (130,000 divided by 13,000 = 10). Just do the math. This means that If you need extensive and expensive home care, you will have to pay for these expenses out of your own pocket. Some may choose this path, others want to do all they can to avoid this expense. Most people tell me they do not want to go broke because they got sick or contracted the wrong disease which led to the need for long term care.
The good news is that transfers made prior to October 1st do not count. Please spread the word among your family and friends that time is of the essence and they should discuss with us the best strategies for protecting their assets.
I hope this helps.
Please forward this information to your friends and relatives.
As always, please send me your questions. If you are thinking about it, others are probably too, so my answers will no doubt help you and many others.
Let’s stay connected.