The Top Seven Mistakes People Make with Medicaid

1. Thinking it's too late to plan.

   It's almost never too late to take planning steps, even after a senior has moved to a nursing home.

2. Giving away assets too early.

   First, it's your money (or your house, or both). Make sure you take care of yourself first. Don't put your security at risk by putting it in the hands of your children without control. Transfers with out professional guidance can cause tax liabilities and Medicaid sanctions.

3. Ignoring important safe harbors created by Congress.

   Certain transfers are allowable without jeopardizing Medicaid eligibility. These include: transfer to disabled children, caretaker children, certain siblings and into trust for anyone who is disabled and under age 65; a transfer to a "pay-back" trust if under age 65; and a transfer to a pooled disability trust at any age.

4. Failing to take advantage of protections for the spouse of a nursing home resident.

   These protections include the purchase of an immediate annuity, petitioning for an increased community spouse resource allowance, and in some instances petitioning for an increased income allowance or refusing to cooperate with the nursing home spouse's Medicaid application.

5. Applying for Medicaid too early.

   This can result in a longer ineligibility period in some instances.

6. Applying for Medicaid too late.

   This can mean the loss of many months of eligibility.

7. Not getting professional help.

   This is a complicated field that most people deal with only once in their lives. Often a great deal of money is at stake. It's penny wise and pound foolish not to consult with attorneys who focus on guiding clients through the process.

© 2005, Legacy Lawyers.
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