There is a significant chance you will need to qualify for Medicaid during your retirement years to cover the high cost of long-term care. If so, the Medicaid eligibility guidelines could prevent you from qualifying if you did not plan accordingly. To help make sure you are eligible if you need to qualify, the Essex Junction Medicaid planning attorneys at Unsworth LaPlante, PLLC explain the Vermont Medicaid eligibility guidelines for seniors.
Why Would I Need Medicaid When I Am a Senior?
If you never relied on Medicaid during your working years, you are undoubtedly wondering why you would need to plan for the need to qualify for Medicaid as a senior. The need for Medicaid may arise from the need for long-term care (LTC) at some point during your retirement years. With the average cost of LTC running over $100,000 a year nationwide (as of 2021) and an even higher average of over $130,000 per year in Vermont, the average person cannot afford to cover that cost out of pocket. Although Medicare will likely cover most of your healthcare costs as a senior, it will not pay for LTC nor will most basic health insurance plans. Unless you purchased a separate LTC plan that may leave you faced with paying out of pocket unless you qualify for Medicaid. Medicaid does cover LTC expenses; however, the Medicaid eligibility guidelines for seniors could be problematic if you did not include Medicaid planning in your estate plan.
Vermont Medicaid for Seniors Eligibility Guidelines
Because Medicaid is considered a “needs-based” program, an applicant must demonstrate financial need to be approved. To do that, you must not have income or “countable resources” above the applicable threshold. The “countable resources” limit is very low in most states, including Vermont. For example, an individual applicant cannot have countable resources worth more than $2,000. If your countable assets exceed the limit at the time you apply, your application will be denied, and you will have to “spend-down” your assets before applying again. Some assets are exempt, meaning they do not count toward your “countable resources,” including:
- Your home, up to an equity limit of $630,000 if you are planning to return to the home.
- Your automobile with no equity limit.
- Burial Accounts (up to $10,000.00 per person).
- Household furnishings, furniture, clothing, jewelry, and other personal effects.
- IRA in payout status BUT the payouts will likely count toward your income limit
How Can Medicaid Planning Help?
Planning is often necessary because transferring non-exempt assets at the last minute may not protect those assets. Medicaid now uses a five-year “look-back” period that prevents transfers of assets for less than fair market value for the 60-month period prior to an application for Medicaid. A review of your finances will be conducted when you apply for Medicaid and if any such transfers are uncovered, Medicaid will likely impose a waiting period. The length of the waiting period will depend on the value of the assets transferred and the average cost of LTC in your area. During that waiting period, you will be forced to cover the cost of LTC on your own. By incorporating Medicaid planning into your comprehensive estate now, before you need to qualify, you can protect any valuable non-exempt assets and keep your retirement nest egg intact.
Contact Essex Junction Medicaid Planning Attorneys
For more information, please attend one of our upcoming FREE webinars. If you have questions or concerns about Medicaid planning, contact the experienced Essex Junction Medicaid planning attorneys at Unsworth LaPlante, PLLC by calling 802-879-7133 to schedule your appointment today.
- The Intersection of Asset Protection Planning and Estate Planning – Part I - September 29, 2022
- Vermont Medicaid Eligibility for Seniors - September 15, 2022
- Are Alzheimer’s and Dementia the Same Thing? - September 13, 2022
