Medicaid Planning?

 

Medicaid Planning

In my Estate Planning, the topic of "planning for Medicaid" often comes up. I don't know why we, in the U.S., have gotten so oriented toward thinking we'll need "Medicaid" when we are one of the richest countries in the world.

 

I believe that planning for Medicaid is akin to planning for FAILURE. Why do I believe this?

 

As a teen, I worked in Nursing Homes and Assisted Living Centers. The staff always knew which beds were "Medicaid Beds". Those beds were always limited. Did they receive essentially the same care? Sure, but it was still known that the spot was "Medicaid".

 

Medicaid has limited options. Medicaid is subject to change at lawmakers' whims. Medicaid is designed for the truly poor. Why would triggering Medicaid be your goal?  Have you ever been in a Medicaid predominant  (only) facility and liked it?  Would you want to live that way?

 

I prefer to see people have more options as they age. I prefer to see people take more proactive steps toward their healthcare.

 

The alternative is orienting your estate and assets toward being able to afford your own care. How do you do this? I see two (2) options: 

  1. For those with "investment portfolios", talk to your accountant or "investment professional" about how to best situation those assets to maximize your care without impoverishing yourself for Medicaid. If you have investments but do not work with a professional, find one. They can make a huge difference.
  2. For those both with and without investments, Long Term Care (LTC) insurance is a good option. It's changed a lot since it's inception decades ago. Now, the more common forms of LTC insurance policies are attached to either Annuities or Life Insurance. The point in doing this is that the money has "multiple jobs" as opposed to only being allocated to one (1) form of insurance benefit.  Also:
    • Many insurance carriers have employees, whose job is to help you find care that fits your needs at NO ADDITIONAL COST. 
    • There are tax advantages to LTC policies, but they vary by policy.

If you can eventually leave an inheritance for your family, that's great, but being able to afford quality healthcare options in your senior years should be a higher priority than whether or not the kids get your old house.

 

What are your thoughts?

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