Medicaid Planning and Spend Down
Because Medicaid is a program for people with low income and great need, each state has established a limit on how much income and assets people who are on Medicaid can have. Assets include checking and savings accounts, mutual funds, stocks and bonds, deferred annuities, the cash value of many life insurance policies, revocable living trusts, retirement funds and some burial funds and trusts beyond a minimum amount.
If your assets are more than your state allows, you will be required to either spend them down or move some of those assets into types that are considered exempt - that is, types that don't count against you for purposes of qualifying for Medicaid. If you move your assets, you need to do so carefully. Transfers done incorrectly can create a penalty period where you won't be eligible for Medicaid at all, even thought your assets are low. States can look back at asset transfers done up to 60 months or five years before you apply for Medicaid.
It is important to talk to a qualified advisor such as an elder law attorney before you attempt to spend down or transfer assets to qualify for Medicaid.
For more information please call 563-359-0854 or email Robert Cain.
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