East Brunswick, New Jersey

Why Medicaid planning is so important for aging adults

On Behalf of | Apr 18, 2024 | Uncategorized

Aging typically inspires an assortment of medical challenges. Older adults may face issues ranging from cognitive decline to decreased strength and range of motion. In some cases, the effects of aging are significant enough that they prevent someone from continuing to live independently in their golden years.

Older adults may eventually need a nurse to come to their homes to administer treatments or may need to move into a nursing home facility for regular care. It is, therefore, important for aging adults to plan ahead of time for the possibility that they may require Medicaid benefits.

Medicare has many limitations

In theory, most adults who have worked for a living or who married someone who worked for years can receive Medicare benefits later in life. Medicare provides basic medical coverage to adults after they retire. However, Medicare has many limitations regarding what treatment it may cover. For example, there are limits on rehabilitation services and on benefits for nursing homes and other assisted living facilities. Many older adults only learn about these shortcomings in their coverage when they need more support than they can get through Medicare.

At that point, they may prepare to apply for Medicaid, only to find they cannot qualify for benefits quickly. Medicaid typically looks back at five years of someone’s financial records before approving them for benefits. Any gifts or transfers in the 60 months before someone applies might make them personally responsible for care costs before Medicaid covers their expenses. It is of the utmost importance that those worried about their support needs later in life plan early, ideally before retirement begins, to avoid the Medicaid penalty.

Medicaid estate recovery efforts might lead to the liquidation of someone’s remaining assets after their death. Someone who relies on Medicaid might not be able to leave an inheritance for their children or other selected beneficiaries unless they plan carefully before they require extensive medical support. Planning to qualify for Medicaid and addressing other elder law matters is as important as establishing a basic estate plan. Those preparing for retirement also need to think about their long-term care needs as part of the preparation process.