This Examiner reporter sat down with attorney Douglas Chu, whose practice, Hynes & Chu, in NYC, specializes in all aspects of elder care law. Mr. Chu speaks frequently at organizations such as The Alzheimer’s Association of New York City, Lenox Hill Hospital, and J. P. Morgan Chase Bank, just to name a few.
Mr. Chu says that of all the areas of elder law, the most common questions he gets during these presentations relate to Medicaid. There is a great deal of rumor and speculation and misunderstanding about the Medicaid program. Attendees often have questions for him such as “my mother wants to apply for Medicaid, but she has a house and a little money, so she isn’t eligible, right?” and so on
I asked Mr. Chu if he would share some of the misconceptions about Medicaid with Examiner readers. Please note that this information applies to New York State only.
Eileen Maraldo and Doug Chu:
EM:. Is it true that I must wait until I spend all my (or my loved one’s) money before I can apply for Medicaid?
DC: Partially true. There are two different Medicaid applications and processes in New York State. The first one is to apply for Medicaid home care. The other is for nursing home care. It is a surprise to most caregivers that in New York State you may gift away (transfer away) all of your/your loved one’s money today and you will be eligible for Medicaid home care services the following month, assuming that you qualify in all other ways. However, if you gift away money, then you will be ineligible for nursing home coverage from Medicaid for up to five years from the date of the gift
EM:. I hear that Medicaid will only let me keep $845/month from Social Security to cover all my loved expenses and I will have to give Medicaid all my extra income. Is that right?
DC: This is correct, but by opening a “pooled income trust”, you will be able to shelter all your/your loved ones income. By depositing all your income—including the Social Security amount over $845/each– into a pooled trust, it becomes invisible to Medicaid and you get to use the money in the pooled trust to pay your monthly bills.
EM:. Medicaid will make me/my loved one spend retirement money, including IRA or 401K money, before I can be eligible for care.
DC: No. All retirement funds such as an IRA or 401K or other pension funds are exempt and not counted by Medicaid. These funds may be kept and will pass to the named beneficiary upon your death. However, any money coming out of the retirement accounts each month is counted as monthly income (see question above re pooled trusts).
EM: Will Medicaid take my house when I pass away?
DC:. .Maybe. Medicaid has a right to claim reimbursement during the probate of the estate. However, if your house does not pass through your will, then Medicaid cannot make a claim. With advance planning, you can prevent your house from passing through you or your loved one’s estate. You or your loved one can prevent Medicaid from making a claim against your house when you pass. There are also certain people who live in your home who allowed to keep in your home such as a disabled child, a caregiver child or a sibling living with you.
EM. Will Medicaid let me keep a limited amount to pay for funeral expenses?
DC:. No, there is no limit on how much money you put aside for a funeral. However, whatever you decide to spend on the funeral must be prepaid to the funeral home, and the purchase must be irrevocable.
EM.. If I go into a Nursing Facility that accepts Medicaid, would that mean a facility with substandard care?
DC .No, virtually all nursing homes accept Medicaid. There is no such thing as a Medicaid nursing home.
EM . I want to apply for Medicaid now, while my loved one is healthy, so I can be prepared for illness or any other crisis. Can I do that?
DC Unfortunately, this cannot be done. You can only apply for Medicaid when you need services covered by Medicaid now. If you do apply and do not use your Medicaid card for a few months, then your Medicaid will be terminated.
EM My mom qualified for Medicaid here in NYS. If I move her to California to be closer to me, does the Medicaid move with her?
A. No, each state has its own Medicaid program. When you move to another state you must re-apply in that state. Each state’s rules for eligibility will be vary.