Beware:  Preparing for the Cost of Nursing Home Care.  Is Medicaid the Answer?

Its hard to plan for “old age.”   None of us know in advance what challenges we will face.   Of course, needing Assisted Living Care or Nursing Home care is a possibility we all must face.    The average cost of Assisted Living in Texas is $4,300 a month and for Nursing care is $5,000 per month.   Depending on for how long institutional care is needed, that is enough to wipe out an inheritance, one way or another……

Many seniors get Medicaid to pay for the costs of nursing home care. Getting Medicaid to pay for care can be very important because Medicare will not cover a nursing home under most circumstances, nor will private health insurance. This means if you do not have Medicaid coverage, there is a very good chance that you will end up having to pay out of pocket for your care.

Unfortunately, the problem is that Medicaid is means-tested so you may not qualify for benefits if you have countable assets. There is also another very serious issue that you need to consider as well. There are estate recovery rules in place that are set by the federal government and that require states to try to collect back money paid out for Medicaid-covered nursing home care.  The Medicaid estate recovery rules could allow the state to try to take your home in order to recoup the money that was spent on your care.

Medicaid estate recovery rules allow the state to take a number of different tactics in order to try to recoup the money that was spent by Medicaid on your care. One of the tactics that Medicaid can take is to make a claim on your estate and try to collect assets after your death. Medicaid may also be able to place a lien on property that you own and then will get repaid for the care you receive when the home is sold either during your lifetime or after your death.

Although the federal government requires Medicaid estate recovery, every state sets their own parameters and rules for how they attempt to recover the money paid out. This means if you own property or assets outside of Texas or obtained Medicaid coverage in a different state, you could face a different estate recovery process.

The bottom line, however, is that under Medicaid estate recovery rules, it may be possible for the state to try to recover what was spent by taking and selling your home. However, there are some limitations to when Medicaid will be able to take this action. For example, if you have a surviving spouse, Medicaid may not be able to take the home when your spouse is still alive. Medicaid may also be restricted from trying to take the house if you have minor children, blind or disabled children, or if caregivers are living in the home and would face hardship if it was taken.

These are just some of the limitations put on the Medicaid estate recovery process, and the rules on when your home is protected can also differ by state as well.  But, because your home could potentially be at risk, you do need to be proactive about working with an attorney to do your best to try to ensure that this valuable asset — and other assets that you own — are available to pass down to your heirs.