There are many myths out there concerning Medicaid applications, one of which is that the nursing home will handle the application for you. Let’s take a look at an example of why professional Medicaid planning is so important.
Laura was entrusted as the agent on her father’s durable power of attorney. She is a very responsible caregiver and is always on top of her father’s finances and makes sure that his bills are always paid at the nursing home. When it comes time to apply for Medicaid, the nursing home staff assures Laura that her father will have no problems in the application process and that they would handle the paperwork.
Despite the nursing home’s reassurance, a few months later Laura receives a letter in the mail stating that there would be a two month penalty period before her father would receive Medicaid coverage.
This penalty is because unbeknownst to Laura, a couple of years ago her father gave a family friend $15,000 that was not reported on the application filed by the nursing home. As the Medicaid caseworker went back through the records while reviewing the application process, she discovered the $15,000 gift. This gift results in a two month period that the nursing home care that will have to be paid out of pocket at a cost of more than $14,000.
The most unfortunate thing about the situation is how easily it could have been avoided. Elder Law Attorneys have legal strategies for avoiding penalty periods. If Laura would have filed the Medicaid application with the assistance of a qualified elder law attorney, she could have saved herself a lot of money.