Medicaid often provides a necessary bridge between what private insurance, and/or Medicare pay for in terms of long-term care for seniors. What many people are unaware of is that once a senior accepts Medicaid payments, they are subject to estate recovery in Louisiana.
How Does Medicaid Estate Recovery Work in Louisiana?
Once a nursing home resident who is covered by Medicaid dies, the state has a right to reclaim the expenses which were paid under Medicaid for their care. These estate recoveries apply to any care the person received beginning at age 55 and continuing through their death. The expenses may include hospital care, prescription drug payments, and facility services received in a nursing home. Estate recovery by the state may be done in a number of ways including:
- Filing a claim against the recipient's estate
- Placing a lien on the family home (if one exists)
There are limitations as to when the state is able to place a lien on the family home. For example, if the home is owned by two spouses (tenants by entirety in Louisiana), as long as the other spouse remains alive and living in the home, the state has no recourse to the property. There are other exceptions to the state's ability to seek recovery as well including:
- When the property is in a revocable trust
- When the property is the primary residence of the person who was responsible for caring for the decedent prior to their entering the nursing facility or becoming eligible for Medicaid
What Are The Other Limits on Medicaid Placing a Lien on a Home?
Yes, there are. Medicaid may only place a lien on a home under certain circumstances. In some cases, the home is protected when some of the following situations exist:
- The beneficiary has a living spouse
- The beneficiary has a blind or otherwise disabled child (regardless of where they live)
- There is a minor child living in the home
- The beneficiary has a sibling who has occupied the home for at least one year prior to the beneficiary being admitted to a nursing facility
- The beneficiary has a non-disabled child who has resided in the home for a period of at least two years prior to admission to the facility — child must have contributed to the beneficiary's ability to remain at home
Is It Possible to Protect My Home from Medicaid Estate Recovery?
Yes, it is possible and the sooner you look into these options the better off you will be. You can protect your family home from being part of the Medicaid estate recovery by taking steps to preserve this asset, and others, well before you need to consider Medicaid eligibility. An attorney who understands Louisiana's community property laws, and estate planning can help you make the right decisions for you and your family.
What are the Eligibility Requirements for Medicaid for Nursing Home Care?
Nursing home eligibility requirements for Medicaid in Louisiana are fairly simple to follow. The party must be a legal resident of Louisiana, must be a U.S. Citizen or be a legal resident in the United States for more than five years, and meet the requirements of the facility for admission among other things. You can learn more about the non-financial eligibility requirements on the Louisiana Medicaid FAQs page.
There are also financial restrictions on eligibility which is at least less than three times monthly Supplemental Security Income federal benefit rates. In instances where the income is higher, the beneficiary does have the option of “spending down” their monthly income by paying medical expenses.
What is the Total Cost of Medicaid in Louisiana?
According to Kaiser Family Foundation (KFF) approximately 20 percent of the $10 billion in annual Medicaid expenses in Louisiana are directed to long-term care. This same study shows that three out of four nursing home residents are beneficiaries of Medicaid.
What Assets Count Towards Medicaid Eligibility in Louisiana?
Assets such as life insurance policies, stock and bond holdings (including mutual funds), retirement accounts, checking and savings accounts cannot exceed a value of $2,000 for an individual or more than $3,000 for a couple. Certain personal property including prepaid burial expenses and plots, life insurance policies which have no more than $10,000 in cash surrender value, one vehicle, and the family home may be excluded from the total value of assets.
When counting assets, if only one spouse is applying for Medicaid, there are allowances made to ensure the spouse who is living in the marital home has the funds they need to life properly. When an application for Medicaid is made, any assets which were sold or transferred in the five years prior to application may be subject to a look back provision. Like many other facets of Medicaid, there are exceptions to the look back provision including:
- Giving assets to a disabled family member
- Property not owned by the person applying for Medicaid
- Giving property to immediate family members including siblings under some conditions
As you can see, these rules can be extremely complicated and require someone who understand the Medicaid eligibility restrictions as well as the provisions which allow the state to reclaim what they paid towards care after the beneficiary is deceased.
Work with an Experienced Medicaid Nursing Home Financing Attorney
While most of us never consider the possibility we will require nursing home care, the time to think about such a need is well before it becomes a necessity. The future may be impossible to predict but, it is never too early to plan for all eventualities. You can find out what options you have pertaining to Medicaid eligibility and Medicaid estate recovery by contacting the experienced elder law attorneys at Brown Weimer LLC at 504-561-8700 or by using our online contact form. We have more than two decades of experience handling Louisiana Medicaid issues and we will make sure you know what options are available to you under the law and take the necessary steps to ensure your estate is preserved for your heirs and not subject to Medicaid estate recovery.