Medicaid Myth #1 – The State will always take my home if I need Medicaid to pay for long-term care.
Paying for Long-Term Care: Did you know that Medicare will not cover the cost of a nursing home for more than about 20 days? The average person stays in a nursing home for 835 days according to the National Care Planning Counsel. Who pays for the remaining 815 days? There are a couple of options, including long-term care insurance, which many people cannot afford or waited too long to obtain, or for most people, paying with their own life savings. Medicaid will also cover the cost of long term care as long as certain asset and income limits are met.
Costs of Long-Term Care: Did you know the average cost for a nursing home is $67,525/year in South Carolina. Therefore, 835 days in a nursing home will cost about $211,000. Unfortunately, the average 60-year-old American has about $172,000 saved for retirement (Synchrony Bank).
Medicare vs. Medicaid: Medicare is a federal health insurance program for adults who are 65 years of age and older. You qualify for Medicare if you are at least 65 and a U.S. Citizen or a permanent legal resident for the past five years. Medicaid is a needs-based health insurance coverage program that many seniors use to pay for their long-term care. In order to qualify for Medicaid you have to meet certain asset and income requirements.
Your House and Medicaid: A common myth is that you cannot keep your house and qualify for Medicaid. This is simply not true, you can keep your home and still qualify for Medicaid, your spouse can continue to live in the home while you are receiving Medicaid, and the State will not make you sell your home in order to qualify for Medicaid.
Truth: It is true that upon your passing the State will put a lien on your estate/home to recover any money that was expended by Medicaid to pay for your care. There are ways to protect your home from Estate Recovery in these situations.
Giving your home to your child right before you apply for Medicaid is NOT a good option, Medicaid will view this as an uncompensated transfer, and will penalize you by denying you Medicaid benefits equal to the amount your home is worth. For example, if you give your house to your son and the home is worth $200,000, Medicaid will determine you need to pay for $200,000 of your own care before you are qualified to receive Medicaid benefits. Therefore, not only do you not qualify for Medicaid, but you lost the chance for your home to count as an exempt resource. Let our experienced team teach you some common legal strategies for protecting up to 100% of the value of your home and other assets, while ensuring you or your loved ones qualify for and receive the long-term care they need. Call or email us today at 803-764-9555 or melissa@hollysimpsonlawfirm.