As you get older, one of the things you need to think about is long-term care planning. Part of this planning may include looking into the cost of nursing home care and how you’ll cover it.
Planning to use Medicaid is one option. Most, though not all, nursing homes do accept Medicaid as a form of payment.
Medicaid provides coverage to those with limited resources
The one thing to realize about Medicaid is that it is available to those with limited resources and income. This is why Medicaid planning should be a part of your estate planning and long-term care planning process. By taking assets out of your name before the Medicaid look-back period, you may be able to reduce your estate’s value enough that you won’t need to be concerned about spending down your assets when Medicaid coverage is needed.
Medicaid varies in every state, but in the majority, eligibility is based on your personal resources and income. Nursing home residents benefit from higher Medicaid income limits in most states, so that means that you may be able to qualify for coverage more easily.
Medicaid isn’t the only way to cover your nursing home care
In some situations, a patient won’t be eligible for Medicaid. If that happens, then you would want to have long-term care insurance or other kinds of insurance coverage to pay for the nursing home care. If you don’t have long-term care insurance, then you may have to pay out of pocket. This can cost tens of thousands of dollars annually, depending on the length of the stay.
If you need nursing home care in the future and don’t have a plan in place, you could end up spending down many of your assets. This negatively impacts your estate and may mean that you will leave less to your spouse, children or other beneficiaries.
Good planning will help you have the financial coverage you need for longer-term care, so you can relax knowing that you will be cared for and that your assets are largely protected against having to be spent to cover your care.