Who Should Consider Medicaid Planning? Determining Eligibility or Excess Spend Down © 2013, LWPWho Should Consider Medicaid Planning?1

Summary of What We Covered Last Week © 2013, LWPWho Should Consider Medicaid Planning?2 Look Back Date/Period Spend Down Transfers Penalty Period

This Week We Will Cover © 2013, LWPWho Should Consider Medicaid Planning?3 Exemptions Case Study Miscellaneous Rules

The LWP™ Medicaid Planning Principles © 2013, LWPWho Should Consider Medicaid Planning?4 Learn the rules (Federal/Local) Determine if client is eligible or excess spend down amount If excess, identify the spend down method Create and implement the Funding Plan

Qualification Exemptions © 2013, LWPWho Should Consider Medicaid Planning?5 Home Exemption Single  Only if “Intent to Return Home” But, subject to estate recovery (at death) unless applicant returns home prior to death, no lien can be placed some states require to return home within a time frame (e.g., 6 months) Home with equity of $536,000 (2013) or less is exempt  State has option to increase to $802,000 (2013) and/or based on CPI  Excess equity is “Available Resource” (e.g., Reverse Mortgage) Married  Home is exempt and no right to recovery from surviving spouse* *Some states require home to be transferred to CS prior to Medicaid eligibility

Home Exemption © 2013, LWPWho Should Consider Medicaid Planning?6 Single or Married  Life Estate in a residence Must reside in home 1 year after purchase (DRA ’05)  Spouse/Child Exception (Minor/Disabled)  Child Caregiver Exception Must reside in home for 2 years prior to parent’s admission to nursing home  Sibling Exception Sibling must co-own home and reside there for 1 year prior to IS’s admission to nursing home  Homestead Exemption (state)

Other Exemptions © 2013, LWPWho Should Consider Medicaid Planning?7 Automobile Home Improvements Personal Belongings Prepaid Funeral Assets to Produce Income to MMMNA Life Insurance (up to $1,500 Face Value)

Case Study © 2013, LWPWho Should Consider Medicaid Planning?8 Mr. & Mrs. Smith Determine Eligibility From Law (common/statutes) From Local Medicaid Dept. From Client. Counseling Art Science Spot the Issue Spot the Issue Ask the Questions Ask the Questions Apply the Rules Apply the Rules When does Mr. Smith qualify? When does Mr. Smith qualify? Get the Answers Get the Answers

© 2013, LWPWho Should Consider Medicaid Planning?9

No Income Issue Life Insurance exempt Home exempt Can be exempt Stocks exempt Snapshot date is January 1, 2009 $120,000 x 3% + $300.00/month Savings are excess Below MMMNA Care status covered? How long will Medicare pay? Length of anticipated stay? Calculate income on savings and add to MMMNA 60 months transfer to or from trust? Has stay been continuous? Medicare support? Prior snapshot date? Has the state adopted DRA? Eligibility Issues Noted © 2013, LWPWho Should Consider Medicaid Planning?10

Concern about completing application because may not qualify What do estate planning documents look like? Is Mr. Smith competent? Is Mrs. Smith competent? Do they have Power of Attorney? Who is client? Who is decision maker? Who is paying bill? Any liabilities or debts? Citizen? Do they have prepaid funerals? Assets titled how? Health insurance? Other expenses beyond cost of care? SS gross or net? Do the Smiths have long-term care insurance? Are either Veterans? House Repairs? Disabled/Minor Children? Questions to Ask Client © 2013, LWPWho Should Consider Medicaid Planning?11

Miscellaneous Rules © 2013, LWPWho Should Consider Medicaid Planning?12 “Solely for the Benefit of” “Undue Hardship” “Spousal Refusal” “Estate Recovery”

Summary of What We Covered © 2013, LWPWho Should Consider Medicaid Planning?13 Exemptions Case Study Miscellaneous Rules

Next Week We Will Cover © 2013, LWPWho Should Consider Medicaid Planning?14 Determining the Spend Down Method Spend Down Methods Case Study