We encourage people who don't have long term care insurance to develop a game plan years in advance for paying for long term care, a very costly expense that is not covered by Medicare or private health insurance. This type of planning often involves transferring specific assets out of the name of the person who will be receiving the long term care so that, by the time that the care is needed, the recipient will be eligible for Medicaid to cover the costs of the care.
For example, we recommend that married couples transfer the home into the name of the Community Spouse (the one living at home) and out of the name of the Institutionalized Spouse (the one living in a nursing home) or Revocable Living Trust (RLT) for the following reasons: A recent Ohio court case held that a home titled in a RLT is a countable resource for Medicaid qualification purposes. (Contrast this to the home being an exempt asset if titled in the name of the Community Spouse alone or the Husband and Wife jointly.) Also, if the name of the Institutionalized Spouse remains on the home and Medicaid benefits are provided to the Institutionalized Spouse, Medicaid may put a lien on the home to the extent of the share of the Institutionalized Spouse.
Medicaid planning, as it is often called, is complicated. We suggest that you schedule an appointment with us to assist you in developing a game plan to address long term care expenses. Don't do it alone; one wrong transfer may disqualify the recipient from receiving Medicaid.