This guide provides a summary of commonly misunderstood issues regarding Medicaid law and planning in West Virginia and gives a brief list of things you should never do without the advice of a Medicaid planning attorney.
Why You Should Plan for Medicaid Eligibility
Medicaid covers certain physician services and nursing home costs for those who meet Medicaid's income and asset guidelines. Private-pay nursing home rates can cost between $5,500 and $10,000 per month, which can quickly deplete an individual's life savings and retirement. With the proper planning, you can avoid this outcome and leave a legacy to your loved ones.
Your Home is Likely Not Counted for Medicaid Eligibility
You do NOT have to sell your home to qualify for Medicaid so long as the value of your home is under $543,000 (in 2014). If your home's value is over $543,000, there are planning options available so that your home will not be counted. Medicaid does not take every asset into account when determining your eligibility. These "non-countable" assets must meet strict guidelines, and it is important to know which assets will be counted, which assets will not be counted, and whether you can convert your "countable assets" into "non-countable assets." You should contact a Medicaid planning attorney to discuss your options.
Your Home May be Subject to Medicaid Estate Recovery
Although your home is probably not counted for Medicaid eligibility purposes, it may be subject to estate recovery after your death. Medicaid seeks to recoup the money it spent on your nursing-home care by placing a lien against your probate assets after you pass away. Without the proper planning, you may not be able to leave your most valuable asset to your loved ones.
Different Rules Apply for Married and Single Persons
If you are married with a spouse who may need nursing home care in the near future, Medicaid law offers more protection over your family's assets and income. For single or widowed individuals, there is less protection over the amount of assets that you may keep. Different asset protection strategies may be more attractive depending on whether you are married or single.
Do NOT Give Away or Hide Assets
Some people may gift their assets to their children or loved ones in order to qualify for Medicaid. Don't do it! Medicaid will assess a "penalty period" against you if you or your spouse made any uncompensated transfers within 60 months prior to your application for Medicaid. "Uncompensated transfers" refer not only to outright gifts, but also to those transfers where you or your spouse did not receive the full fair market value for the asset. This means that you must pay the private-pay rate of nursing home care for the length of the penalty period, which can quickly deplete the money that you've worked so hard to save.
Do NOT Re-Title Your Home
For purposes of Medicaid, simply putting your home in the name of a child or loved one is considered a gift, and the same penalty period described above will apply.
Do NOT Make Checks Out to Cash
When applying for Medicaid, you must provide bank statements from at least the past three (3) months for any accounts held by your or your spouse. If you have written any large checks out to "Cash," it may cause Medicaid to question whether you have been gifting money in order to reach the asset limit. If so, you will have to provide bank statements for the past 60 months, and all transfers from your bank accounts will be called into question.
Do NOT Assume that You Will Qualify for Medicaid If and When it is Needed
If you are interested in finding out what will need to be done in order for you, your spouse, or loved one to qualify for Medicaid, talk to a Medicaid planning attorney. Provide your attorney with a list of all your assets, including cars, home(s), real property, motorcycles, RVs, bank accounts, retirement accounts and anything else that he or she may ask for. Planning in advance for Medicaid is much easier, and usually much cheaper, than waiting until you or your loved one is already in a nursing home.
You do Not Have to Impoverish Yourself to Qualify
One of the most widespread misconceptions is that you have to spend all of your money in order to qualify for Medicaid. As was mentioned above, Medicaid only takes into account "countable assets" when determining your eligibility. The goal of Medicaid planning is not to impoverish you in order to meet the asset limit. Rather, the goal is to convert your countable assets into non-countable assets. There are several ways to convert your countable assets, but it must be done right. Do not attempt to do this on your own. A good Medicaid planning attorney will provide you with an overview of all of your options, and will work with you in deciding which options are the best for your unique situation.
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