As parents get older, children begin to take on the role of caretaker and assist their parents in making various medical and financial decisions. In fact, I receive more phone calls from children of seniors looking for Medicaid planning for their parents than from the parents themselves. They are looking to understand what they can do to help their parents get Medicaid long term care benefits without jeopardizing everything their parents have worked to earn. This article will highlight a few important points children of seniors should be aware of as they go about helping their parents qualify for Medicaid.
Plan for the Unplanned: Power of Attorney
I always recommend that all clients, but especially seniors considering Medicaid planning, have a valid, updated power of attorney. Too often, a parent who needs Medicaid long term care is unable to quickly and easily transfer their assets to an irrevocable Medicaid Trust or sign up for a pooled trust in order to qualify. In some cases, the parent begins the process and loses the necessary mental capacity to complete it. A valid power of attorney prepared by an elder care attorney can give children the tools they need to help their parent pay their bills, deal with their finances, and get them the care they need while protecting their assets, even if a parent loses the mental or physical ability to do it themselves.
Eligibility: Knowledge is Key
When I ask potential clients if they have considered Medicaid as part of their long term care strategy, I often hear the concern that they have too much income or too many resources to qualify. Instead, they opt to private pay until they can’t afford to do so anymore. Many are surprised to learn that they can qualify for home care Medicaid without a look-back period and can preserve their assets for their children. Therefore, I encourage children of seniors to learn about New York’s Medicaid rules in order to be able to have informed conversations with their parents about their long term care options.
Qualifying for Medicaid is not enough. Families must also plan ahead in order to avoid Medicaid recoveries and liens. Eligibility and protection are two distinct issues that need to be dealt with as part of Medicaid planning. I often encounter children who assume that just because their parent is receiving Medicaid, that Medicaid can’t touch their assets. In fact, the opposite is true. Precisely because the parent is on Medicaid, their assets can be collected upon, sometimes during life and other times after they pass away. Proper Medicaid planning includes both the eligibility portion which puts the care in place and the post-eligibility portion which protects assets to the maximum degree allowed by law.
An effective long term care Medicaid strategy for parents consists of carefully analyzing each family’s unique situation with an eye towards planning for incapacity, evaluation eligibility, and protection of assets. With these three foundational principles, families can be well on their way to getting the care they need while protecting the assets they worked so hard for.