How to Let Medicaid Pay For Your Long Term Care

'Medicaid Planning' has come to mean planning to transfer your assets to loved ones in order to qualify for Medicaid coverage of your long-term care (LTC) costs. This article explains some key issues involved in arranging to let Medicaid pay for your long-term care.

Paying for your long-term care for just a year or two can deplete your savings or cut into your intended legacy to your children. You can also get more information about Medicaid collections at

Image Source: Google

Looking to begin paying LTC insurance too late in life can also leave you paying very high premiums since your chance of needing LTC increases to over 50% in your 70s.

If your wealth rises into the millions, you can probably pay all your LTC costs directly – and not ruin you legacy. But many people have assets near or well below a million dollars -including their home -which will be substantially wiped out if they have to pay LTC costs themselves.

To try to protect those assets, these people are the ones who often do Medicaid planning.

So what is involved in Medicaid Planning?

Medicaid is now paying nearly half of all nursing-home bills after residents run out of money. So why not 100%? Well, you have to be poor before Medicaid picks up the bill for you.

Most states require nursing-home residents to spend virtually all of their assets – down to as little as $2,000 — before they may qualify for free Medicaid services. Couples have a higher retained allowance if one spouse is healthy enough to remain at home.

That 'spend-down means that your assets will pay for the expenses Medicaid spends for you until you are down to $2000. It's only then that Medicaid picks up the bill itself. That's because Medicaid was intended to provide health care for the poor.