Introduction
A traumatic health event can leave seniors with a sudden need for significant long-term care and coverage. Medicaid is often the best solution in these situations, but getting quick Medicaid coverage is a challenge. At Eldercare Resource Planning, we’ve found it takes an average of 162 days for our clients to be covered by Medicaid: 79 days to complete the application plus 83 days waiting for approval from the state. Medicare will only pay for nursing home care for 100 days, so acting quickly is necessary.

Hiring a professional like a Certified Medicaid Planner is the best strategy for families facing an emergency with a loved one, but if that’s not possible, or to help a family get started on their planning path, this article provides the best steps for families to take after a loved one has suffered a health event.

Determine Power of Attorney

The first Medicaid planning step families should take after their loved one suffers a traumatic health event is to determine if the individual had designated anyone with Power of Attorney with control over their health or finances. If so, this person will be able to make all decisions and access all the necessary information needed to help their loved one plan and apply for Medicaid.

If no one has been designated as Power of Attorney (POA) and the individual who had the health event still has the mental capacity to do so, they should immediately designate someone as POA with control over financial and health matters. That way, if their health continues to fail, someone they trust will be able to make important decisions for them. If the individual is incapacitated, they will not be able to designate a POA and some of the decision-making power may be given to the state.

Assess Finances and Gather Documents

To qualify for Medicaid, applicants must prove they meet two financial eligibility requirements – the asset limit and the income limit. After a health event, families should immediately begin assessing their loved one’s finances to see if they meet their financial limits, which can vary based on the state, the applicant’s marital status and the Medicaid program they are applying for – Nursing Home Medicaid, Home and Community Based Services (HCBS) Waivers or Aged, Blind and Disabled (ABD) Medicaid.

As they are evaluating finances, families should also start gathering official documents that detail the situation, such as institution-issued year-end summaries and Social Security benefits letters. These documents must be submitted with the Medicaid application to prove the individual meets their financial requirements. Gathering this paperwork is the most time-consuming part of the Medicaid planning and application process, and it’s even more difficult if the applicant is impaired due to their recent health event, so starting this process as soon as possible is essential for families.

To determine if a loved one is immediately eligible for Medicaid long-term care, we provide a free eligibility test on our website. To use this test, one must know the approximate income and assets of the candidate and their spouse, if married.

If the individual does not meet the standard financial eligibility threshold, they should consider retaining a Medicaid Planner. With financial planning assistance, most candidates with the medical need for long-term care can become eligible.

Families might assume their loved one can’t qualify for Medicaid if they own a home, but many primary homes are exempt from the asset limit. Click here to read more about Medicaid’s home ownership rules.

Assess Medical Condition

After a health event, seniors and their families will be seeing their physician and, most likely, other doctors and caregivers. These healthcare professionals will help determine what is needed for their loved one’s short-term and long-term care. They can also determine whether or not the senior meets their medical eligibility criteria for Medicaid, which is needing a Nursing Facility Level of Care (NFLOC) for most programs. In general, this means the type of care and supervision associated with nursing homes, but the exact definition of a NFLOC and how individuals are evaluated can vary by state.

If the doctors are unsure, or unavailable, families can use a service like the Level of Care Assessment we offer at Eldercare Resource Planning to see if their loved one meets their medical eligibility criteria. Seniors who utilize this service will be evaluated by registered nurses with Medicaid expertise using the same tests and criteria that are used in their state to determine if applicants need a NFLOC or not.

Implement Medicaid Planning Strategies

If the individual in crisis does not meet either of their financial eligibility limits, families can use Medicaid planning strategies to reduce their loved one’s assets or income until they do meet their requirements. Applicants can’t simply give away their assets to meet their limit, and to make sure they don’t Medicaid uses the Look-Back Period, which is five years in most states. This means state officials will look back into an applicant’s financial history for the five years before they applied for Medicaid to make sure they have not given away any assets or sold them at less than face value.

Asset Planning Strategies

If a senior has assets over the limit, there are several ways they can reduce those assets and become eligible. Some of these strategies can be employed quickly, such as “spending down” or buying a Medicaid Compliant Annuity or an Irrevocable Funeral Trust, so these methods will be especially helpful for families who are trying to get coverage for their loved one as soon as possible after a health event.  Click here to read more about qualifying for Medicaid when over the asset limit.

Income Planning Strategies

If a senior’s income is over their Medicaid income eligibility limit, they can still qualify for Medicaid by using either the Medically Needy Pathway or a Qualified Income Trust. Which one they can use depends on where they live – some states offer the Medically Needy Pathway and others use a Qualified Income Trust. Click here to read more about qualifying for Medicaid when over the income limit.

Search for a Nursing Home or Assisted Living

If the individual needs to relocate to a nursing home or an assisted living facility after their health event, the family should begin searching for a facility as soon as possible. Finding a nursing home or an assisted living community, including memory care, that accepts Medicaid and has an opening for a new Medicaid resident can take a significant amount of time.

To look for a nursing home, families can start by using this Medicaid Nursing Home search tool which uniquely allows users to compare homes that accept Medicaid, Medicare or Veterans Benefits. After finding potential homes in their area, families should visit each facility to see what will be the best fit for their loved one.

Unfortunately, there is no national search tool for assisted living residences that accept Medicaid. While there are many assisted living locator services, none of these are intended for persons who are looking to use Medicaid to pay for assisted living care. If their loved one needs assisted living, families are best advised to conduct the search on their own. They should start by making a list of all the residences in their area and calling each one to see if they accept Medicaid and have an opening. They should then visit potential residences to find the best fit.

Evaluate Other Payment Sources

As families are deciding whether or not to apply for Medicaid, they should consider all other options.

-Medicare – Covers up to 100 days in a nursing home for rehabilitation purposes, but it will not cover long-term stays in nursing homes.
-VA Pensions – A veteran who was receiving a Basic VA Pension may be eligible for an increase after a traumatic health event. If their care needs changed enough due to the event, they could qualify for the Housebound or Aid & Attendance Pension. More about VA Pension eligibility.
-Long-Term Care Insurance – If the individual has a long-term care insurance policy, it may kick in after the health event if long-term care is needed. However, these policies rarely cover the full cost of long-term care, at least not for an indefinite period of time. They do, however, give the family enough time to plan for Medicaid. Unfortunately, these policies can only be purchased when the buyer is in good health, usually in their 50s or 60s.
-Life Insurance – Some life insurance policies can be sold in advance of the policyholder passing in an arrangement called a “life settlement.”
-Home Equity – Using home equity to pay for care is an option, but it is not necessarily a desirable one and typically is not necessary to qualify for Medicaid. In fact, sometimes doing so makes one ineligible for Medicaid. This topic is robust and beyond the scope of this article. It is recommended that one consult with a Medicaid Planner if they are considering using a home to pay for care.

Getting Professional Help

As you can see, Medicaid Planning is an involved process. Trying to do it all in a short period of time while dealing with the emotions of a health crisis is not ideal. In these situations, paying for professional help from a Certified Medicaid Planner (CMP) or Elder Law Attorney is usually the best choice. Some professional organizations, like Eldercare Resource Planning, offer a free initial consultation, and making this the first step in the planning process after a health event will, most likely, prove to be extremely helpful.

CMPs are especially useful in a crisis situation. They can complete the planning and application process quickly because they have done it so many times before and they have a thorough understanding of Medicaid eligibility rules and benefits. CMPs also know which financial documents will be required, where to find them and how to acquire them, even if the applicant is incapacitated. If there are questions, CMPs know who to ask in the local Medicaid office to get the most timely answer. If there is a problem with the application, including a denial, they know the best ways to appeal. Perhaps most importantly, using a CMP in these situations will let family and friends focus on their suffering loved one instead of trying to navigate the complex Medicaid system.