Paying for home care aides and nursing home care, without spending a fortune, is a common concern of many of my clients. Why? Because long-term care in New York is very expensive. In New York City, for example, aides can cost $26+ per hour and care in a nursing home can cost $130,000+ per year. Many of my clients have already experienced the crushing costs of long-term care, whether they have been paying for their own long-term care needs or a loved one’s. This is why elder law and estate planning attorneys can’t stop talking about “asset protection”.
One way to protect your assets from the crushing costs of long-term care, is by applying for Medicaid. However, many people overlook Medicaid as an option, because they think they need to be impoverished to receive it. In theory, you can actually be very wealthy and still receive Medicaid long-term care services and supports in New York. This is because Medicaid isn’t really a program for the poor, it’s a program for people who are poor in certain types of assets.
For example, In New York, someone who owns nothing except a home worth $700,000 and a $1,000,000 IRA could be eligible for Medicaid! How? Because these types of assets are “exempt” from Medicaid. In other words, when determining eligibility for Medicaid, these assets are invisible to the agency administering Medicaid. It is true that if the IRA is making distributions, the income is counted, but too much income does not generally disqualify you from receiving Medicaid long-term care services. The “excess income” can be used to pay for Medical expenses or home care aides, for example, without disqualifying the recipient from Medicaid benefits. Even more interesting, in New York, there is no five-year look back for Medicaid long-term care in the home or an assisted living facility. The five-year look back penalty period only applies to nursing home care.
Medicaid is Complex
So what does this mean in a practical sense? It just means that Medicaid is complex and is anything but straightforward. Navigating the world of Medicaid long-term care should only be approached with the assistance of an experienced elder law attorney. If you are interested in learning more about protecting your hard earned savings from the high costs of long-term care, I encourage you to contact me at 646-820-4011 or firstname.lastname@example.org.