Avoiding Issues When Applying for Medicaid
August 16th, 2023
Over 1.4 million Americans, mostly elderly, live in nursing homes. Over 60 percent of those nursing home residents receive Medicaid benefits to pay for their care. No one likes to think about the possibility of needing long-term care, or not having the resources to pay for care if they do need it. But the reality is that care in a nursing home is so expensive that most people won’t be able to pay out-of-pocket for very long. When personal funds begin to run out, it becomes necessary to apply for Medicaid to pay for care.
Applying for Medicaid may be common, but that doesn’t mean it’s easy or straightforward. And unfortunately, errors in the application process can result in a denial of benefits just when they are needed most. Let’s consider some of the most common issues with Medicaid applications, and how to apply for Medicaid in such a way that you avoid them.
Common Medicaid Issues in Ohio
Sometimes applicants have issues with Medicaid because they don’t understand the system, and sometimes because they’re trying to “game the system.” An experienced elder law attorney can help you understand program eligibility requirements and avoid making accidental errors or potentially disastrous decisions.
Transferring Assets to Loved Ones
In Ohio, you can have no more than $2,000 in non-exempt assets in order to be eligible for Medicaid. (Certain assets are not considered “countable” for Medicaid eligibility purposes.) Unsurprisingly, people who have worked hard all their life to build a legacy for their family are reluctant to lose those assets to a nursing home. A common impulse is to avoid the need to “spend down” assets by giving them away or selling them at less than fair market value to family members. However, doing so can create serious problems.
For one thing, Medicaid has anticipated that applicants might try to do an end-run around asset requirements by transferring assets to loved ones. In response, the program has created a five year “look-back” period. What that means is that if you have transferred any asset to anyone for less than its fair market value in the five years preceding your Medicaid application, your application could be denied or your eligibility for benefits could be delayed for many months.
It’s simply not worth taking the risk to try to protect your assets; instead, seek the help of a qualified elder law and Medicaid planning attorney to help you legally protect your assets from the nursing home.
Failing to Take Advantage of Allowable Transfers
The Medicaid “look-back” period exists to prevent fraud, not to punish families. Accordingly, there are a number of “safe harbor” transfers that you can make without putting your Medicaid eligibility at risk. For instance, if you have an adult child who has lived with you for at least two years and provided care for you in your home, you may be able to transfer your home to that child under Medicaid’s “child caretaker” exception. There are other permissible transfers, too, like certain transfers to disabled children. A Medicaid planning attorney can advise you of other options that apply to your particular circumstances.
Failing to Document Your Application
Applying for Medicaid is a complicated process that requires you to provide a lot of financial information. It should not come as a shock that the government will not simply take your word about the state of your finances. Failing to provide accurate and thorough documentation of the information you provide on your application could easily result in your application being denied.
Take the time to get the documents you need to fill out your Medicaid application correctly, and provide the government with any required documentation.
Failing to Disclose Resources
Deliberately leaving some of your resources off of your Medicaid application in the hope that the government won’t discover the omission is an unwise gamble; if the unreported resources are discovered, your application will almost certainly be denied. But even an inadvertent omission can still cause you problems. It could be difficult to prove that you did not intend to defraud the Medicaid agency, and you could still be penalized.
Fortunately, the same measures you take to gather documentation of all of your assets can also help you to remember smaller or less-used accounts that will need to be reported on your application. Working with an elder law attorney and their staff can be helpful in ensuring that you don’t overlook anything important when applying for Medicaid.
Applying for Medicaid Too Soon—or Too Late
If you apply for Medicaid benefits too early, your application will be denied, you will have spent energy, time and money, and you’ll just have to do it all over again in a few (or several) months. On the other hand, if you wait too long to apply, you could be missing out on months’ worth of benefits to which you would have been entitled. As soon as you think that you or a loved one might need Medicaid for nursing home care, speak with an elder law attorney to determine when and how to apply for Medicaid benefits.
Thinking That Medicaid Covers Everything
While approval for Medicaid means that most of your nursing home costs will be covered, you may still need to contribute some amount, referred to as your liability, toward the cost of your care in a nursing home. Your liability is based on your income and expenses and must generally be paid to the nursing home on a monthly basis.
Not Getting the Help You Need
When you are looking at the potential costs of a nursing home, you may think that you can’t afford to hire a lawyer to help you plan. The reality is that you can’t afford not to. Whether you are planning ahead for the possibility of needing long-term care, or in the midst of nursing home crisis planning, an experienced elder law and Medicaid planning attorney can help you find resources to pay for care and do everything possible to help preserve your assets and qualify when applying for Medicaid.
Get help to apply for Medicaid in Ohio and to avoid unnecessary issues with Medicaid. Contact Gudorf Law Group to schedule a consultation.