Medicaid coverage helps close the gap between what people can actually afford and the care they actually need. People who meet relatively strict qualifications could be eligible for Medicaid coverage for necessary health care.
In some cases, older adults who have had successful careers may apply for Medicaid to cover the costs of their long-term care. Medicare generally does not pay for a room in a nursing home or a home health aide. Those who need that degree of support may need to apply for Medicaid to cover those costs.
Older adults who believe they may eventually require Medicaid coverage may want to plan in advance. Otherwise, the legacy that they intended to leave for their loved ones may differ substantially from their plans.
Medicaid pursues posthumous repayment
As a needs-based program, Medicaid only covers the treatment expenses of those with limited countable assets and income. People may be eligible for Medicaid despite owning their own homes. Their houses and other remaining assets may then be vulnerable after their passing.
Federal law requires that states establish Medicaid estate recovery programs. After a New Jersey Medicaid recipient dies, the state may make a claim for repayment in probate court.
Those claims take precedence over the inheritance rights of beneficiaries or heirs. The only way to avoid Medicaid estate recovery efforts is to plan in advance to protect assets that might be vulnerable. Taking on co-owners, transferring ownership early in retirement or moving assets to a trust are all ways to minimize losses to estate recovery efforts.
Older adults worried about leaving nothing for their loved ones due to their medical decline may need help planning before they apply for Medicaid benefits, and that’s okay. Thorough estate planning, including Medicaid planning, can help people age with grace and leave a meaningful legacy when they eventually pass.
