Many nursing homes and assisted living facilities in Michigan and around the country charge more than $100,000 per year for a private room. This is an expense that many American seniors will face sooner or later, which is why planning for it in advance is so important. Medicaid can help seniors to cover the costs of long-term care, but the joint state and federal health care program is means tested and difficult to qualify for.
Qualifying for Medicaid
Each state sets its own Medicaid guidelines, but the rules are strict in every part of the country. In Michigan, only seniors with incomes no higher than $2,742 and assets worth no more than $2,000 qualify for Medicaid long-term care assistance. While these guidelines would seem to make Medicaid assistance unavailable to most Michigan seniors, there are elder law and Medicaid planning strategies that could help them to qualify.
Medicaid Asset Protection Trusts
Seniors may be able to make themselves eligible for long-term care assistance by placing assets like second homes, investments and certificates of deposit in Medicare Asset Protection Trusts. These are irrevocable trusts, which means they cannot be changed after they are created and the people who create them do not usually have access to the assets they contain. However, they can help seniors to qualify for long-term care assistance.
The look-back period
The costs of long-term care in an assisted living facilities or nursing homes are high and rising, and the government programs that could help seniors to cover them are difficult to qualify for. Trusts can be used to help seniors qualify for Medicaid assistance, but they are not without their drawbacks. Seniors in Michigan who are considering using trusts to qualify for Medicaid assistance should act without delay because the program has a five-year look-back period. This means assets that were sold or transferred in the five years before a senior applies for Medicaid assistance can affect their eligibility.