The process of Medicaid planning helps ensure that your asset worth will not be too high and cause your Medicaid eligibility to be denied. That is why Milwaukee residents engaging in Medicaid planning should be careful not to make mistakes that can result in serious financial harm and a loss of Medicaid eligibility. As explained by AgingCare, there are a number of common Medicaid planning mistakes people should avoid.
Some people fear they have waited too late to begin their Medicaid planning. However, even if your loved one has moved into a nursing home, it is still possible to start planning for Medicaid. However, exactly when a person applies for Medicaid can be an issue. Applying too early can create a prolonged period of ineligibility and cost you a lot of money. However, applying too late can deprive you of assets that you may have planned to pass on to family members.
Medicaid planning can be complicated, and while some people believe they can handle it, it is best to seek professional assistance. Not understanding key aspects of Medicaid law can wind up costing you thousands, perhaps tens of thousands of dollars, if not more. This is why many people planning on receiving Medicaid seek out the help of a professional attorney to go over their plans.
Retaining the help of a professional also helps people to understand that they can transfer assets without risking their eligibility for Medicaid. Congress has created laws that make a number of these asset transfers possible. These include sending assets to siblings that qualify under certain conditions, to children who are caregivers, and to disabled children. Money can also be transferred into a number of trusts that meet qualifications under law.
Some people may feel the temptation to spend down their assets as soon as possible or to give money to children at the first opportunity. But doing so can put your own personal financial health at risk. You might endanger your ability to make important payments, like your utility bills, phone bills, grocery costs, or your taxes. Also, transferring a lot of money can run into tax requirements and may invite tax penalties.
Other oversights include not utilizing protections available to nursing home residents, such as petitioning for an increase in the community spouse resource allowance. Consultation with a professional attorney can help reveal various options available to people seeking Medicaid. Because people have varying needs when it comes to Medicaid planning, this informational article should not be interpreted as legal counsel.