Medicaid is a needs-based state and federal government-funded health insurance program. Americans with income below a certain level and without significant assets can apply for Medicaid to cater to their medical treatment and healthcare needs.
While Medicaid is part of long-term care planning, not everyone qualifies for it. Part of qualifying for Medicaid involves diminishing your assets or changing their ownership. So, when is the right time to begin your Medicaid planning journey?
Don’t wait until you need special care
The truth is, there is no ideal age to commence your Medicaid planning. Rather, planning sooner is always far better than waiting until you begin having health issues that need care. Keep in mind that while reviewing your case, the board will scrutinize your financial records for up to five years prior to the date of your application. Thus, any gift transfers that you effect within the 60 months prior to applying for Medicaid can actually invoke a penalty.
Any amount transferred or gifted will be converted into a number of months of care. This means that you will have to pay for this off-pocket for the duration of the penalty period. And this explains why you are better off beginning your Medicaid planning more than five years before your application.
You have no way of telling when your health might begin to fail you
Most folks in nursing homes are over the age of 65. However, even younger people can end up in these facilities following catastrophic injuries or other medical situations like strokes. For this reason, it is in your best interest to begin your Medicaid planning as soon as possible to protect yourself.
Medicaid planning can be challenging to navigate. Done right, it can provide relief for qualified individuals in need of long-term care. To receive the benefits you are entitled to, however, you need to plan well ahead of time.