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Saving small assets with husband who might need Medicaid - Preserving Assets When Applying for Medicaid


My husband has been in and out of the hospital for the past four months. He has an infection in his neck that is not going away even being on IV antibiotics all this time. They are moving him to a skilled nursing home and I know that when his Medicare runs out, they will send him home to me they will send him home to me. He is non-responsive most of the time, has to be fed and is on IV antibiotics yet every four hours and a catheter. I would like to apply for Medicaid for help but we do have $60,000 in assets in investments, and I am wondering if I have to spend all 60,000 on him so that I have nothing left for myself Before I can apply for Medicaid 

Legal Solution

The response provided below is specific to trusts & estate planning... in the jurisdiction of Quakertown. If the response is inadequate, please submit a detailed inquiry.

Preserving Assets When Applying for Medicaid

Contextual Analysis

It is evident that you are faced with a challenging situation concerning your husband's health and the potential future costs of his care. When it comes to Medicaid, asset protection is a significant concern for many families, especially when you want to ensure you have financial stability for the future. The overarching dilemma is determining whether the $60,000 in investments you have must be spent on his care before Medicaid can assist.

Relevant Legal Provisions

For a comprehensive understanding of Medicaid's requirements, you can consult the following:

  • Medicaid Official Website
  • Title XIX of the Social Security Act - Specifically, this title establishes the Medicaid program.
  • State-specific statutes - Each state has its unique guidelines and asset limits for Medicaid eligibility.

Potential Solutions

  1. Medicaid Asset Protection Trust (MAPT): A trust where assets are transferred, effectively removing them from your direct ownership. This trust can preserve the assets while potentially allowing Medicaid eligibility. However, there is a five-year look-back period for such transfers, meaning that the assets transferred into the trust within the last five years could be counted as assets for Medicaid eligibility purposes.
  2. Spousal Refusal: Some states allow the healthier spouse (community spouse) to refuse to pay for the ill spouse's care. This can sometimes allow the community spouse to retain more assets.
  3. Annuities: Convert assets into an income stream for the community spouse, potentially making the ill spouse eligible for Medicaid faster.
  4. Exempt Assets: Certain assets are considered exempt and won't count towards Medicaid eligibility, such as a primary residence, personal effects, and prepaid funeral arrangements. It may be worthwhile to invest in these areas.
  5. Legal counsel: Engage with an attorney that specializes in Elder Law or Medicaid planning. They can provide tailored solutions. To help you in this quest, you can compare lawyers in your area to ensure you get the right expertise.

Cost Estimates for Legal Assistance in Quakertown

Service Average Cost (USD)
Initial Consultation with Elder Law Attorney $250
Setting up a Medicaid Asset Protection Trust $2,500
Annuities Financial Planning $1,500
Drafting a Spousal Refusal Document $750
Assistance in Medicaid Application Process $3,000

Note: Prices vary based on the attorney's experience, complexity of the case, and other factors. It's essential to get a quote from multiple sources for accuracy.

Clarification and Call to Action

For a more precise solution tailored to your circumstances, some further details would be beneficial. Additionally, your husband's exact health status and detailed financial situation can play a role in the available strategies. It might be prudent to find the right lawyer who can guide you through this challenging time.

Relevant Questions to Address

  • What is the exact nature of your investments? Are they in retirement accounts, stocks, bonds, or real estate?
    • Specific types of investments can have different implications for Medicaid eligibility.
  • Have you made any significant financial gifts or transfers in the past five years?
    • Medicaid's five-year look-back period can penalize unauthorized transfers.
  • Are there other assets or sources of income you have not mentioned?
    • A full financial picture is crucial to determine Medicaid eligibility and the best strategies to protect assets.

Q1: How does the Medicaid five-year look-back period work?

The look-back period refers to the 60 months before a person applies for Medicaid. If any assets were transferred for less than their fair market value during this time, Medicaid could impose a penalty period, delaying eligibility.

Q2: Can I just give my assets to my children to qualify for Medicaid?

Transferring assets can result in a penalty period during which you would not be eligible for Medicaid. It's crucial to consult with an attorney before making such decisions.

Q3: Are all assets counted towards Medicaid eligibility?

No, some assets are considered exempt, such as a primary residence (up to a certain value), personal belongings, one car, and prepaid funeral arrangements.

Q4: What happens if my husband is deemed ineligible for Medicaid?

If ineligible, you would be responsible for paying out-of-pocket for his care until you've spent down your assets to the point where he becomes eligible, or you've satisfied any penalty period imposed by Medicaid.

Q5: Can I use our joint assets for my own personal expenses?

While you can use assets for necessary expenses, it's essential to be cautious. Excessive or unexplained spending can be seen as an attempt to deplete assets to qualify for Medicaid and may be penalized. Always consult an attorney when considering significant financial decisions in the context of Medicaid planning.


This content is for informational purposes only and does not establish an attorney-client relationship. It's always recommended to consult with a local attorney about your specific situation.

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