This year could mark a significant change for Medicaid programs across the nation. Some states look to broaden the government insurance program to more needy individuals while others seek to add more requirements for people to qualify.
States in Favor of Expanding Medicaid
In April, consumer advocates in Utah announced they won enough signatures to create a November ballot measure that would expand Medicaid to over 140,000 adults if approved. Similar signature gathering is underway in Montana, Idaho and Nebraska.
The expansions would extend coverage to approximately 300,000 people in three of the states. And in Montana, such a measure would reauthorize the state’s existing expansion, which covers nearly 100,000 people and is scheduled to end next year, according to The Fairness Project, a national advocacy group supporting the state expansion campaigns.
So far, 32 states and the District of Columbia have opted to expand Medicaid under the health law; 18 states have not.
States in Favor of Adding Restrictions
While some states are exploring broadening Medicaid this year, others are pursuing changes that could lead to hundreds of thousands of people getting kicked off the program.
The push for Medicaid work requirements alone could affect millions of Americans in the 10 states that have so far sought federal approval for the idea, based on a recent report by accounting and consulting firm PwC. That population represents an estimated $8 billion in yearly Medicaid costs.
Work requirement proponents espouse the idea as a way to help lift people out of poverty and improve their health. Opponents argue that most Medicaid recipients who can work already do, and that a work mandate will lead to a bureaucratic nightmare, with vulnerable groups, such as people with disabilities, inequitably losing coverage.
Proposed Changes in Florida
There’s a 100 million dollar reduction in the Medicaid budget that the state hopes to accomplish by reducing the timeframe someone has to apply for the Medicaid program. The state is considering getting rid of a three-month “retroactive eligibility period,” which allows patients to enroll in Medicaid up to 90 days after they see a provider. The legislature this year changed that policy and they’re going to give people 30 days to apply. The change would apply to anyone who is not pregnant and 21 or older. And there are concerns about the number of people who will be affected by it. Initial estimates show about 39,000 people in 2015-16 retroactively had their bills picked up by the state.
Medicaid Planning
Whether you find yourself in a state that favors the expansion of Medicaid or not, it is important to know your options. Proactive Medicaid Planning is a useful tool for seniors who may be faced with the need for nursing home care. Nursing homes are tremendously expensive and can eat up accumulated assets quickly. We employ legal and ethical methods that will transfer your assets so that you may qualify for Medicaid later in life. The most common method is by creating a Medicaid Asset Protection Trust.
A Medicaid Asset Protection Trust is an Irrevocable Trust. You, as the “Grantor” create the Trust, fund it with certain assets, and name an individual “Trustee,” other than you or your spouse, to manage the Trust. You can specify exactly how the assets should be managed and you will be entitled to all of the income for the rest of your life. The principal of the Trust assets will remain in the Trust until your death. When you pass away, the Trust assets will pass directly to your designated heirs. A great benefit to this Trust is that your heirs receive the assets without going through probate.
These types of Trusts are highly complex. Our attorneys will guide you through the process and advise which assets should be placed into the Trust, assist with naming a qualified Trustee, and let you know the instances when you can make changes to the Trust, such as naming a new Trustee, and adding or removing beneficiaries.
Why Medicaid Planning Should Be Considered Early
Medicaid planning is not only about responding to a sudden need for long-term care. Starting the process early can give individuals and families more time to understand their financial position, review available options, and make decisions before a health crisis occurs. Because Medicaid eligibility rules can be complicated, actions involving income, property, trusts, and other assets should be considered carefully.
A thoughtful planning process may help families:
Review their assets and financial circumstances before long-term care becomes necessary.
Understand how property ownership can affect future Medicaid eligibility.
Consider whether a trust or another planning strategy may be appropriate.
Prepare important financial and legal documents in advance.
Reduce the possibility of making rushed decisions during a medical or family emergency.
Understand the potential consequences of transferring or retitling assets.
Coordinate Medicaid planning with an overall estate plan.
It is also important to remember that Medicaid rules can vary depending on the applicant’s circumstances and the type of care involved. A strategy that works for one person may not be suitable for another. Changes in federal or state rules can also affect eligibility requirements and planning options.
For Florida seniors and their families, reviewing a long-term care plan with an experienced attorney can provide an opportunity to identify potential issues before they become urgent. Proper planning can also help families better understand what may happen to their home, savings, investments, and other property if nursing home care becomes necessary.
The goal of Medicaid planning is to create a legally appropriate strategy based on an individual’s circumstances while protecting important financial interests as much as possible. Early legal guidance can make the process more organized and help families understand their responsibilities before submitting a Medicaid application.
Contact OC Estate and Elder Law at (954) 251-0332 or info@ocestatelawyers.com to learn more about Medicaid planning.
