If you intend to repay family members or friends for their caregiving work, you need to draw up a formal agreement, especially if you think you will ever apply for Medicaid long-term care benefits. It is important to get help from Linda Strohschein, and her team at Strohschein Law Group, in drafting this type of contract.
Reunions, graduations, birthdays, and holidays: Whatever the occasion, nursing home residents don’t want to miss out on family gatherings, but may be afraid that they will lose Medicare or Medicaid coverage if they leave the nursing home. In most cases, Medicare recipients can leave for a day or two, although the nursing home may bill them in order to hold their beds. Medicaid recipients will need to check with their state.
This IRS rule has nothing to do with Medicaid’s asset transfer rules. While the $14,000 that you gave to your grandchild this year will be exempt from any gift tax, Medicaid will still count it as a transfer that could make you ineligible for nursing home benefits for a certain amount of time should you apply for them within the next five years.
Although their names are confusingly alike, Medicaid and Medicare are quite different programs. Both programs provide health coverage, but Medicare is an “entitlement” program, meaning that everyone who reaches age 65 and is entitled to receive Social Security benefits also receives Medicare.
For many Medicaid applicants, individual retirement accounts (IRAs) are one of their biggest assets. If you do not plan properly, IRAs can count as an available asset and affect Medicaid eligibility.