As readers of this blog are aware, we often talk about estate planning. Indeed, last week, we spoke about long-term care planning and including Medicaid in an estate plan. In this week’s post, we will dive deeper into how to qualify for Medicaid.
As explained in the prior post, Medicaid can pay for a significant portion of or entirely for nursing homes, intermediate care facilities and long-term care in one’s own home. In North Carolina, a caseworker at one’s local Department of Social Services determines Medicaid eligibility. Whether one qualifies depends on several factors, like one’s resources, age, income and health needs. Specifically, to qualify for Medicaid, for our purposes (estate planning) one must be 65-years-old or older, blind or disabled, low-income, in need of long-term care and qualify for Medicare. In addition, only U.S. citizens (with a Social Security Number) qualify for Medicaid, and to qualify in our state, one must be a resident of North Carolina with proof of residency. Though, one is automatically eligible if they receive Special Assistance for the Aged or Disabled or Supplemental Security Income.
A key requirement for Medicaid though is the low-income and low-resource requirement. This is based on one’s available resources and income. The amount can change based on health care needs and age, and the ultimate decision is left to one’s local DSS caseworker. However, the basic limitation for monthly income is that it cannot exceed $1,074 for an individual and $1,452 for a family of two.
As for resources, they cannot exceed $2,000 for an individual and $3,000 for a couple. Luckily, the value of one’s personal residence, jewelry, clothing, home furnishings and personal vehicle do not count toward this resource limit. For estate planning purposes though, many things do qualify as resources. These include cash on-hand, retirement accounts (like, IRAs, 401(k)s, etc.), money held in bank and brokerage accounts (including, any other investments) and the cash value of life insurance policies. Though, if our Fayetteville, North Carolina, reader’s resources or income are over these limits, they may still qualify for Medicaid, it would just be at a lower rate or have a deductible.
Finally, as to estate planning, one can use their estate plan to help fit into these requirements, like through a life insurance trust that is held in the beneficiary’s name. There are other trusts that can also be utilized to help meet these limits to ensure that one does not use up their estate on their long-term care costs.