What are some strategies to getting under the Medicaid resource limit?

It is possible to qualify people for nursing home Medicaid who have several hundred thousand dollars. Strategies often used include the following:

Shifting Medicaid countable resources into excluded resources (i.e. acquiring assets or paying down debt on assets that are excluded for Medicaid eligibility purposes);
Requesting expansion of the protected resource amount when a married couples’ combined gross income is below $2,931 per month (in 2014);
Purchasing a Medicaid qualified immediate annuity in order to convert a countable resource to income in the name of a Medicaid ineligible spouse; and
Gifting countable resources.
Several factors determine which strategy or strategies should be pursued. These considerations include:
Whether the Medicaid applicant is single, married with an ineligible spouse, or married and both whom are applying for Medicaid;
Income, gift and capital gain tax consequences of various options;
The current and anticipated financial, physical and/or mental limitations of the Medicaid applicant and dependents;
The presence or absence of trust within the family;
The existing estate plan and/or desired changes thereto; and
The impact the Medicaid Estate Recovery Program (MERP) will have, if any.

CAUTION: Medicaid planning is the practice of law. It is a criminal offense for anyone who is not a licensed attorney in Texas to offer or accept a fee for providing assistance in applying for Medicaid services. Numerous financial advisors and insurance agents (sometimes working in conjunction with an uninvolved lawyer) offer to provide Medicaid planning services. While they may be successful in obtaining Medicaid services, they often pursue strategies that are not in their clients’ best interest, either out of ignorance or greed.

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