Find Out How We Can Help

3 important Medicaid considerations for high-asset adults

On Behalf of | Jan 3, 2022 | Medicaid

Medicaid is a needs-based program, so those who have stable financial circumstances may think they will never need Medicaid benefits. The more personal property you have and the more you have set aside for retirement, the more confident you may feel about your ability to pay for your care out of pocket as you get older.

Even high-asset individuals planning for retirement can benefit from Medicaid planning. There are some important considerations that can affect high-asset applicants in need of Medicaid benefits.

You may need Medicaid even with substantial savings

Trying to cover nursing home costs yourself could use up everything you have saved throughout your life and then some. The average cost for nursing home care depends on where in the state someone hopes to live.

In Central New York, where the costs are the lowest, the average is still $96,360 per year for nursing home care. If you intend to live in the Long Island area, the average cost increases to $142,350 per year. The state reports that older adults, on average, stay in a nursing home for under two-and-a-half years. 

You cannot plan for Medicaid when you need benefits

In New York, every applicant applying for Medicaid is subject to a look-back period. Although you can theoretically gift assets to your loved ones or move property into a trust to help you qualify, you have to do so quite a while before you need to claim benefits. Otherwise, you will trigger a penalty and have to pay out of pocket for care anyway.

If you qualify without a plan, your legacy is at risk

You can potentially qualify for Medicaid without advanced planning if your residence holds much of your personal wealth. New York usually will not use your primary residence against you when you apply for Medicaid.

However, the reason that the state overlooks an asset that could be worth millions of dollars is that they will make a claim against your home and other remaining property when you die. The Medicaid estate recovery program can claim every last asset left in your name and leave nothing for the people that you love in some cases.

Recognizing that even those with significant personal assets may need to qualify for Medicaid can help you protect yourself as you age and leave a meaningful legacy for your loved ones even if your health declines later in life.