Many adults in Ohio (understandably) have an overly simplistic understanding of how the Medicaid program works. They may inaccurately assume that anyone with limited financial resources can qualify for benefits quickly when they have financial and medical need.
However, the truth is that getting Medicaid later in life for long-term care can often be much more challenging than people realize. Many people planning for retirement need to take the time to plan for long-term care or Medicaid in a proactive fashion. These are just a few of the reasons why advance planning is so important if someone may need Medicaid later in life.
There are penalties for those who don’t plan ahead
People can turn to Medicaid for long-term care coverage at a time when they may no longer have the income or assets necessary to pay for a room in a nursing home or other treatment costs. What many don’t realize is that qualifying isn’t necessarily quick and easy.
The professionals looking at someone’s Medicaid application don’t just care about their current resources and income. They will look back at five years of financial records. If there are large transfers or gifts during the five years prior to someone’s application or benefits, those transfers or gifts will trigger a penalty. The state will make someone responsible for their own care costs for a few months, which could leave someone without support or with a huge amount of debt in their final years of life.
The state wants repayment for benefits
As if the possibility of not getting benefits while in a medically vulnerable position wasn’t reason enough to plan ahead, the possibility of estate recovery efforts could convince someone of the need to plan carefully. Whatever benefits someone receives through Ohio Medicaid will become a debt that the state can claim in probate court. Estate recovery efforts can force the liquidation of someone’s assets, including the sale of their home, to pay for the treatment they required when they were unable to cover nursing home or other long-term care costs.
Those who fail to plan ahead might not have any assets left in their estate for spouses and children to inherit after they die. Engaging in advance planning can make it easier for someone to obtain Medicaid benefits when they need support later in life and protect the resources they would like to earmark for loved ones after their death.