Medicaid Spend-Down

Medicaid Spend-Down: Long-term Care Insurance or Medicaid

There is a 50% chance that if you live to be 65 years old that you will spend some time in a long term care facility in your lifetime. Americans are living longer today, and this poses a significant problem to your Estate and financial Nest Egg.

The average monthly cost of Long Term Care now exceeds $4,000 per month. The average stay in a nursing home is 30 months, and 60 months for Alzheimer’s patients. The bottom line? A four year or longer stay in a nursing home could cost $200,000 to $450,000 or more (in today’s dollars).

The Spousal Impoverishment Act, sometimes called Division of Assets, changes the Medicaid eligibility requirement for couples in situations in which only one spouse needs nursing home care.

It allows the spouse remaining at home to protect a portion of income and resources. The spouse needing care can receive Medicaid sooner and without the spouse at home being reduced to poverty.

You have three choices to pay for Long-Term Care costs.

1. Self-funded. This requires you to spend down

your Nest Egg.

2. Long Term Care Insurance. This insurance

may be cost prohibitive but increasingly easier

to qualify for today.

3. Qualify for Medicaid. Access to this Federal

Program is governed by eligibility and

entitlement exceptions.

Questions you need to ask yourself.

If you need Long Term Care, how will you pay for it?

Do you understand your Federal exemptions regarding spend down?

What are the eligibility requirements for Medicaid? What must I go to qualify?