While many people have the mentality of thinking that negative or difficult situations will never affect them, you may not fall into this category. As a result, you likely do your best to make plans and prepare for potential scenarios that could prove hard to address, especially when it comes to your finances. Because many aspects of life can hinge on a person’s ability to pay for necessities, planning ahead can often prove useful.
Because most people over the age of 65 will need some sort of long-term health care, you likely understand that this type of situation could affect you. Therefore, you may want to find out more information on how to plan for long-term care and what options could help you and your family when it comes to paying for that care. In some cases, government benefits programs like Medicaid can help, but only for those who qualify.
When it comes to qualifying for Medicaid, the eligibility requirements tend to focus considerably on the financial aspects of your life. Because this program offers financial benefits, a need for financial assistance needs to exist, and you must prove your need. For example, you will likely need to prove that your income level and accessible funds do not exceed a certain limit.
Planning for Medicaid
Though you may not meet income requirements now, you could take steps to adjust your income or accessible funds to have a better chance of meeting Medicaid qualifications when the need for these benefits comes. One way to potentially plan ahead is to make use of a trust. By placing assets into a trust, you remove them from your estate and from your ability to use them.
However, in order for this step to have a greater chance of working in your favor, you will likely need to take certain factors into consideration, such as:
- Making an irrevocable trust: You cannot change or revoke an irrevocable trust. Therefore, the assets in the trust remain inaccessible to you. If you use a revocable trust, the agents reviewing your Medicaid application may consider the property in your trust as available assets.
- Understanding third-party trusts: A third-party trust means that someone else set up a trust from which you benefit. However, though the funds or other assets are available to you, they will not count against your Medicaid application if the terms of the trust dictate that the assets cannot be used for long-term care.
Creating a trust is only one way that you could potentially plan for Medicaid use and long-term care. If you would like to more fully review and understand your options, you may wish to find out more information from local legal resources.