Medicaid has a spousal impoverishment provision that allows spouses to keep up to 7,240 (the maximum for 2014) and a primary home, though the maximum can vary substantially by state. Personal property is generally excluded, but retirement accounts such as 403(b) plans can be subject to the limits if distributions haven't begun, said K.Gabriel Heiser, an attorney and author of books on Medicaid planning.The answer usually depends upon your marital status, and whether you are already in the nursing home or you anticipate a lengthy stay in the nursing home.
They will be required to spend down their assets in order to become eligible for Medicaid.Many people try to give away their assets to relatives in order to qualify for Medicaid.But when an applicant gives away property within five years of applying for Medicaid coverage of long-term care, Medicaid presumes that the gifts was made to qualify for Medicaid.This will trigger a period of ineligibility for Medicaid long-term care benefits on the theory that those assets could have been used to pay for the individual’s care.Not all transfers, however, trigger a period of ineligibility for Medicaid.The protection of assets is a major challenge for seniors.Currently, the government mandates that all assets are to be spent down if either spouse has to go into a nursing home.There is generally a five-year look-back period for Medicaid, meaning that asset transfers within the five previous years of an application can be subject to penalties.A lot depends on how large of a nest egg you have and on whether you and your husband have heirs for whom you are trying to leave assets after your deaths. You should be aware that certain advance planning techniques for Medicaid are somewhat controversial, with critics claiming that wealthy individuals use them to divert assets and leave the nursing home bills to the government. Can the healthy spouse keep the jointly owned house or will it have to be sold when nursing home costs for the ill spouse require money? There are some ways for spouses to protect some assets before this happens, and that is generally referred to as Medicaid planning, or restructuring assets in an effort to maintain some financial stability for the healthy spouse.