Medicaid (called “MassHealth” in Massachusetts) can help pay for long term care either at home or in a nursing home. If you think MassHealth will be needed in your or your loved one’s future, it’s always best to plan ahead.
Five Year Look-back
If you apply for MassHealth benefits, the state has the right to look at all your transactions of $1,000 or more over the past five years. If any money or property has been given away during this five-year period (whether in the form of an outright gift, transfer to an irrevocable trust or a transfer for less than fair market value), the state may impose a penalty period, which may cause a delay in MassHealth eligibility at a nursing home. This is known as the “five-year look-back”.
Planning Ahead with Your Elder Law Attorney
There are opportunities to protect your assets if you act more than five years before you may need MassHealth to pay for your facility or home care. It is a good idea to have your current estate plan reviewed by an Elder Law attorney by the age of 70 (although the earlier the better!).
Depending on your assets and life situation, there may be an opportunity to place your house or other assets in an Irrevocable Trust. This planning technique could be used, for example, to avoid MassHealth placing a lien on your house in the future.
Planning when a crisis is looming
While advanced planning is always the better way to go, it is not always the reality. If you or a loved one is in need of imminent long-term care services, there may still be an opportunity to do some planning.
Is there a Durable Power of Attorney in Place?
Although there certainly are some elders that fully participate in last minute planning options, often it’s the agent named in the Durable Power of Attorney that is taking the lead. Having a well drafted Durable Power of Attorney is crucial during this time. If there is not a well drafted Durable Power of Attorney in place, steps may need to be taken to obtain a court appointed Conservator. Seeking advice and counsel from an elder law attorney is critical to ensure that the proper authority is in place for another to act on the elder’s behalf.
When to Reach out for Help
It’s a good time to reach out to an Elder Law Attorney if an individual is paying for their care at home or an assisted living facility and is now needing more assistance. A good rule-of-thumb is to advice and counsel when the person has about $100,000 left in their account. This will help ensure there is enough money for attorney’s fees, a pre-paid irrevocable funeral contract, and potentially enough money left to fund a Pooled Disability Trust. Although the options are more limited when a crisis is looming, it is always prudent to explore all the possible options to ensure that the health care needs of you or your loved one are properly addressed and quality of life remains the focus.
Founded by a nurse attorney and with offices in Acton, Burlington, and Sudbury, Massachusetts, Generations Law Group helps families navigate the complex areas of estate planning and elder law to inform and protect loved ones of every generation.