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Medicaid approves homeowners but will try to take the house

On Behalf of | Apr 4, 2022 | Estate Planning

No one knows what will happen to their health as they grow older. Family medical history and personal health issues influence the way a person ages. Some people age gracefully and retain their physical health and mental acuity well into their 80s, 90s or even beyond. Others may start to require support in the years after their retirement.

Some older adults will have the good fortune of being able to rely on family members for much of their care. Others will require in-home support from licensed nurses or around-the-clock care in a nursing home. Medicare does not cover those costs, which means that older adults must pay for these services themselves or qualify for Medicaid.

If your income and assets other than your home are low enough, you can qualify for Medicaid benefits in your later years, but the state will eventually seek repayment for whatever benefits you receive.

You can qualify with the house, but the home is at risk

The Georgia Medicaid program will approve applications by those with primary residences worth far more than the asset cut-off for applicants. The value of someone’s home doesn’t prevent them from receiving benefits.

However, that practice does not protect the home indefinitely. After you die, Georgia’s Medicaid estate recovery program will bring a claim against your estate for all of the care the state paid for on your behalf. Your executor will have to sell off or liquidate assets to repay the Medicaid program for the benefits that you received. This process can result in the sale of your home and any other assets left in your name.

Even if you pay off all other debts before you die, Medicaid estate recovery could mean that your children inherit nothing from you. Long-term care planning helps individuals ensure that they can qualify for Medicaid if they ever need benefits while simultaneously seeking to protect the legacy they leave for their loved ones after their deaths.

Planning several years before you need long-term care benefits will offer the best protection for those hoping to leave an inheritance for their loved ones while also connecting with support for their medical care later in life.