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Medicaid / Medicare Trust Planning

As you grow older, certain benefits become a necessity since age, disability, retirement, and other issues that arise in your later years can all be costly. Planning to meet those expenses and needs is absolutely crucial to estate and disability planning.

Help is available through Medicare and Medicaid, but only if you qualify for them and—in some cases—if you are able to pay for them. Medicare and Medicaid trust planning helps you prepare for just that. To set up these trusts, you need the assistance of elder law experts. Hart David Carson attorneys provide you with the guidance you need to make fully functional plans.

Medicare vs. Medicaid

Simply put, Medicare is a government-provided health insurance plan for the disabled or elderly. There are no asset limits to qualify, but there are a number of things Medicare won’t cover, such as prolonged stays in a nursing home.

Medicaid, on the other hand, is a federal and state program that provides coverage for low-income families and individuals and will pay for some items that Medicare will not. However, to qualify for Medicaid, your countable assets must be under a certain limit.

Medicaid and Medicare Asset Limits

Medicare has no asset limits to qualify for the actual insurance plan. However, qualification for the Medicare Savings Program (MSP), which helps pay for Medicare premiums, does. The countable assets considered in qualifying for the MSP include stocks, bonds, and checking/savings account funds. They do not count such assets as your home, car, burial expense funds, furniture, and other personal property.

Medicaid requires that the value of your countable assets be kept under a certain limit. There are a number of ways for a Medicaid applicant to reduce the assets that fall within the required limits. These include:

  • Spending down, or spending assets until you fall under the limit
  • Setting up a trust to effectively remove property from your countable assets

Setting up a trust will allow you to pass on a portion of your estate to your heirs without disqualifying yourself from Medicaid. However, in order to work, it must be set up a certain way.

Structuring a Medicaid Trust

The purpose of setting up an irrevocable trust is to remove assets from your estate. In other words, while you may still benefit from the assets placed into the trust, you do not actually own the principal assets themselves. In order to help you qualify for Medicaid, your trust must be set up in a certain way.

Other types of trusts may also provide you with income while allowing you to fall within Medicaid eligibility limits. These include testamentary trusts and supplemental needs trusts. Again, these each need to be structured a certain way to ensure your eligibility for Medicaid. Setting this up requires knowledge of the laws and regulations in place on Medicaid, asset transfers, and trust structuring.

Obtaining Legal Assistance

Hart David Carson provides the expertise in elder law to help you with your Medicaid and Medicare trust planning. We can counsel you on the options you should take and help you implement them in a way that satisfies your needs. For a free consultation, contact us today.

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We have been working closely with HDC for about 4 years now, we trust them for our own legal work and for all of our clients. They have proven themselves to be dependable and hardworking. They have yet to let us down in any capacity. We are looking forward to growing this relationship for us and our clients. Azmi S. (Elmhurst, IL)
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