If you have accumulated any sort of wealth and assets, depending on Medicaid to fund your long term care expenses could be a bad idea. Medicaid was not necessarily created for that purpose. It is a joint federal and state program designed to help citizens who have limited assets and income. Eligibility is not a given, and varies from state to state. Finally, most states have Medicaid estate recovery programs that allow the state to go back and collect what was paid in Medicaid benefits after a person has passed.
Medicaid was created in 1965 by President Lyndon B Johnson as part of a movement to eliminate poverty and racial injustice. It does cover long term care, but only after you’ve impoverished yourself by spending down your assets. Usually the cut-off point is $2,000, however this amount can vary from state to state.
In order to be eligible for Medicaid there are medical and financial requirements, depending on your state of residence. People may also have limited choices as many home health agencies and assisted living facilities do not accept Medicaid since the reimbursements can be low. Also, anything outside the nursing related services as approved by Medicaid will not be covered. Personal care items and simple luxuries are at the expense of a patient or their family.
While it started out for the poorest Americans, Medicaid is also being used as an additional funding source for middle\upper income Americans who need long term care services. But few people are aware that every state has a Medicaid Estate Recovery Program and fewer still understand that this law gives the government the right to recover what they have paid out in long term care benefits. They can even seize your house.
It’s estimated that 70% of people will need long term care at some point in their lives. Today, the cost of care is staggering and varies depending on the state you live in. These numbers will continue to increase each year due to inflation.
When you’ve worked hard to build your wealth and assets, you don’t want to lose them due to an expensive long term care event. Long term care insurance can protect your assets by paying for home and community care, assisted living, nursing home care, and more. Take steps today and speak to a specialist about a plan that works for you and your family.