Estate planning isn’t just necessary for new parents and those with serious medical challenges. It is also very important for those preparing for their golden years. The years leading up to retirement are an ideal time to create or potentially update estate planning paperwork.
In addition to thinking about a personal legacy in the form of assets that pass to loved ones after someone dies, it is also important to think about what may happen as someone grows older. Estate planning may include incapacity planning where people address the possibility that they could end up incapable of speaking on their own behalf due to medical issues.
People may also plan for their long-term care needs, including the possibility that they may eventually need to move into a nursing home. Those addressing their long-term care needs often have to plan for the potential financial needs, not just practical support. Planning ahead of time can help older adults obtain Medicaid coverage when they need it later in life.
The problem with applying without preparation
In theory, anyone can apply for Medicaid when they believe that benefits are necessary for them to access crucial medical care. However, some people may apply for benefits while their total personal assets are still above the threshold for qualifying.
Even if someone qualifies at the time they apply, the state cares about their recent financial transactions as well. If the person applying for Medicaid conducted any sizable transfers or made large gifts in the five years or 60 months before they applied, they may have to pay a large penalty before they qualify for coverage.
If someone qualifies without penalties, the benefits they receive could affect the legacy they leave after they die. The state can initiate estate recovery efforts that could lead to the forced liquidation of assets that family members expected to inherit. Even the primary residence of the person who receives the Medicaid benefits could be vulnerable to sale after their death without advance planning.
Those who take the time to address Medicaid benefits and other elder law concerns as part of a broader estate planning effort can feel confident that there should always be support available to them regardless of their situation. Planning to successfully navigate the Medicaid application process is a smart move for older adults who might eventually require nursing home care as they age.
