Q: When should I plan for my long-term care needs?

A: If you are planning on purchasing long-term care insurance (LTCI), the prime age to do so is around 55 (in order to receive premium rates). There are various types of LTCI offering differet levels of protection for you and for your assets. You should weigh your options carefully, and be sure to ask about the benefits of Indiana Parnership Plans.

If you are preparing for eventual government assistance - typically through the VA or Medicaid - then the answer depends on the source of the assistance. Eligibility for Aid and Attendance through the VA can be obtained quickly, but requires that the recipient (and his or her spouse, if applicable) have less than $80,000 in assets, including vehicles, real estate, investments, bank accounts, etc., regardless of whether they are owned by the applicant or the applicant's spouse. It is possible to protect your assets and still receive VA benefits with careful planning.

If you are planning with the goal of eventually becoming eligible for Medicaid, then the best time to plan is at least 5 years before you believe you will need ongoing care. Since predicting that date is difficult, you should consider factors such as your personal health, your family's health history, how much control you need over your assets, your personal finances, and how soon you or your loved one will need traditional Medicaid or Medicaid waiver services.

Q: What is Medicaid for the aging?

A: Medicaid is a jointly funded, Federal-State health care program for persons who are financially eligible. Medicaid provides financial resources for medical needs, rehabilitation, and long-term care both at home and in nursing homes.

Q: Do I qualify for Medicaid?

A: To qualify for Medicaid in the State of Indiana, you must be a resident of Indiana, a U.S. Citizen, age 65 or older, (or blind or disabled) and meet certain medical requirements consistent with the level of care requested. Additionally, there are strict income and resource guidelines with which you must comply. If the applicant has gross income in excess of the income limit, a Qualified Income Trust (often called a Miller Trust) must be established before the applicant will be eligible for Medicaid. The cap on personal resources of the applicant is strictly enforced.

Q: Do I have to spend all my money on healthcare to be eligible for Medicaid?

A: No. While the party applying for Medicaid cannot have more than $2,000 in his or her name, proper planning will enable him or her to protect assets for ongoing care, as well as for future distribution to loved ones.

Q: Should I just give everything away?

A: Maybe, if you do not expect to need long-term care for at least five years. Medicaid has the right to look at your transfers for the last 60 months. A transfer occurs any time a valuable asset (real estate, money, investments, vehicles, insurance policies, etc.) has been given to another party for less than fair market value. Giving away your assets can cause a penalty, resulting in a self-pay period with your long-term care provider. It is possible to plan around a penalty, and sometimes a penalty may become part of the Medicaid application plan.

Additionally, what makes sense for your estate plan and taxes may not make sense for Medicaid eligibility. Tax law allows for as many gifts of $14,000 per person (as of 2016) as an individual may wish to make in any given year. Medicaid only allows for $1,200 (in total, not multiple gifts of $1,200) to be gifted in any given year.

Q: Can I use a revocable trust or a living trust to prepare for Medicaid?

A: No. A revocable trust is a good tool for estate planning, but because the trust can be changed by the settlor, Medicaid treats the assets of a revocable trust as though they are still owned by the settlor.

Q: Do I need to be in a nursing home to receive Medicaid benefits?

A: No. There are several forms of medicaid, and while some require beneficiaries to be living in a nursing home, it is possible to receive Medicaid for the Aged, Blind, or Disabled while living at home, in an assisted living facility, or in a nursing home.

Q: Does Medicaid for the aging have a time limit?

A: No, Medicaid will pay for long-term care in a nursing home for as long as an individual qualifies for the care, even it if this means several years of care.