Can You Protect Assets From Long-Term Care Costs in Virginia?

Costs associated with long-term care are among the most pressing financial concerns of older adults and their relatives. The monthly cost of residential nursing home services in Virginia can be very high, leading to rapid depletion of available funds. People often ask whether there is a way to protect their house, finances, or other assets from being spent on long-term care.

Yes, it is possible; however, such protection should involve adequate preparation and knowledge of Virginia’s Medicaid requirements.

Why Medicaid planning matters

Nursing home care is not covered by Medicare; therefore, most elderly patients turn to Medicaid to help pay for their long-term care costs.

The requirements for Medicaid enrollment include meeting strict financial and resource guidelines; otherwise, one cannot qualify. Families are often shocked to learn they must spend a significant chunk of money before receiving assistance.

If no advance planning takes place, a large amount of resources may be depleted.

Certain assets may be protected

Not all properties receive equal treatment under Medicaid guidelines. In certain cases, some properties may be exempt when determining eligibility.

For instance, the family’s main house can be protected if one spouse or other family members reside there. Some items of personal property, cars, and prepaid burial services can also be excluded.

Nevertheless, even if some properties are exempt from consideration during one’s life, they may still be subject to Medicaid estate recovery upon death.

The five-year lookback period

An essential part of Medicaid law is the five-year lookback period. When an individual applies for long-term Medicaid care, the government will review transactions from the last 5 years.

If there have been transactions involving transfers that occur without any consideration in those five years, then Medicaid will assess penalties against the person that will result in delayed qualification.

Examples of such transfers include giving away the house or transferring cash gifts to your children before you qualify for Medicaid. Many folks unknowingly fall victim to this kind of trap.

Medicaid asset protection trusts

One of the most popular ways to handle estate and care issues is to set up an irrevocable Medicaid asset protection trust. Such a trust will make it possible to remove some assets from your name without exposing them to long-term care costs.

Properly established, an irrevocable trust can enable the elderly to avoid paying for long-term care services.

However, irrevocable trusts come with significant financial implications. Once you place assets into them, you will no longer have direct access to those assets.

Crisis planning is still possible

Even amidst a crisis, there are still solutions when the elderly individual is already in need of a nursing facility. Elder law attorneys will employ crisis planning methods, allowing some family resources to be safeguarded while enabling the person to qualify for Medicaid services as soon as possible.

Planning ahead of time offers families greater choice and flexibility.

Talk to a Virginia Beach, VA, Elder Law Attorney Today 

The Law Office of Angela N. Manz represents the interests of Virginia Beach residents who are looking to draft or modify an estate plan. Call our Virginia Beach elder law attorney today to schedule an appointment, and we can begin preparing your estate right away.