How do I protect my assets from Medicaid in Florida? You’re not really protecting them from Medicaid. What you’re doing is, you must qualify for Medicaid in Florida, and that may require you to spend down or use your assets to pay for your own care until they reach a certain threshold. There are two guide. There’s an asset test and income test for married persons, which is quite generous. However, if you’re a single person, the qualify for Medicaid, the amount that you can have is truly a small amount. I think it’s about $5,000. However, one big benefit that we have in Florida is your home. If you have homestead exemption on your home, then that does not qualify as an asset and does not have to be sold or used, the money from it for your care or to qualify for Medicaid. The property can’t be rented, however, it’s not considered, an asset as far as qualifying for Medicaid. So that is a huge benefit. Also, there are certain trusts that you can set up called a Miller trust to help qualify you. So if you need to do some Medicaid planning to try to preserve some of your assets for your heirs, give me a call at (727) 847- 2288.
What is the look back period for Medicaid and Florida? It is five years. So whenever an application is made for Medicaid, you must indicate whether or not any conveyances transfers have been made for less than full and fair consideration. I believe the threshold amount is $500. As far as the value of any gifts or transfers that have been made, if any had been made during the five year period, well then it may, it will disqualify the applicant for a certain period of time, which is developed by dividing into the amount the cost of the Medicaid benefits. So, the five year period is five years. And in Florida, as far as Medicaid’s concern, and any questions about Medicaid will give me a call (727) 847-2288.
If I purchase a house or property and put my child’s name on it, will this be counted as a gift?
Well, the answer is yes, you’re gifting them an interest in property. So when do you need to worry about gifting property to your children is if you would decide to apply for Medicaid. That may disqualify you for the amount of the gift if it happens within five years that you apply for Medicaid. Sometimes, people call me or want to do this in order to avoid probate, and they want to add their child’s name to a deed as joint tenants with right of survivorship. I did not suggest doing this. There’s life estate deeds or ladybird deeds that can take care of avoiding probate whenever you hold title jointly with your children. The problem is, they now own a half-interest in the property, subject to any creditors’ claims that your children may have. So it’s somewhat problematic, even worse if your children are minors. Then you won’t be able to sell it unless you have a guardianship, possibly. So it’s not a particularly good idea. So, the idea is to say what you’re trying to accomplish. Are you trying to avoid probate by doing this? What is the purpose?
So if you have a question about that before you add your child’s name to a deed or purchase property in their name, give me a call at 727-847-2288.
What is a Miller Trust? Well a Miller Trust is also known as a Qualified Income Trust, also known as a d4a trust. A lot of times people have confusion as to whether or not a Miller Trust is a viable planning tool for them when it comes to estate planning. However, a Miller Trust is only specifically utilized for one thing and that is with respect to qualifying for Medicaid coverage for skilled nursing care, within the State of Florida. Well why would I potentially need a Miller Trust in the event that I needed Medicaid for skilled nursing care?
Well, the whole purpose of a Miller Trust is to divert excess income that the recipient is receiving on a monthly basis. Let me explain how this works. Right now the allowable threshold for income on a monthly basis from Medicaid for skilled nursing care is $2,205 per month. Let’s say you have a situation … I want to be very clear here, this is the gross monthly income. There’s a lot of misnomers where people … 2,205 net within my bank account each month from my social security. Unfortunately, Medicaid does not consider what your net income is. Medicaid only considers what your gross monthly income is. Let’s use the hypothetical example that you have an individual whose gross monthly income is $2,206 per month, so $1 over the allowable threshold for Medicaid. In that situation, if you just applied for Medicaid based upon what your income was, you would be denied, and a lot of people say, “Well, a dollar, that’s not very much at all,” but that’s the requirement.
In order to essentially divert that excess money, that dollar each month, a Miller trust is created and funded in the same month that you are trying to attain Medicaid coverage, in order to divert that excess income. A Miller trust is only a viable planning tool in the event that you do have more than $2,205 on a monthly basis as far as your gross monthly income, in order to qualify for Medicaid for skilled nursing care. If you have any other questions regarding a Miller trust or if a Miller trust is a viable planning tool for you, please give me a call here at the law firm of Waller & Mitchell at 727-847-2288.
Can I trigger ineligibility for Medicaid coverage for skilled nursing care once I’ve already been approved for Medicaid coverage? The answer to that question is an emphatic absolutely. Let me give you an example. I had a client of mine today asked me a question regarding the sale of a vehicle. The situation, this gentleman was already approved for Medicaid, was already in the skilled nursing facility and Medicaid had already been paying for skilled nursing care for several months. He was in a position where he had a vehicle. That vehicle he was obviously getting no use out of because he was in skilled nursing care and could not drive, so his daughter wanted to know if it would be a possibility that he could either sell the vehicle or give the vehicle to her.
That sort of situation you absolutely would not want to do anything with the vehicle. Not sell the vehicle or give it away. The reason being is that Medicaid eligibility is reviewed on an ongoing basis. This specific situation, if he gave the vehicle to his daughter he would be looking at a period of ineligibility based upon the value of the vehicle because it would be considered a gift, a transfer of assets for less than value. What if you sold the vehicle? That wouldn’t be considered a gift. Well know it wouldn’t but in that sort of situation, the money that he would receive as a result of the sale of the vehicle in this situation $20,000 would also trigger ineligibility for Medicaid coverage due to the fact that he would now be over the above threshold which is $2,000 which would then make him ineligible for Medicaid coverage.
In this specific situation, what you would do is you keep the vehicle. You can store it, hopefully at a relative or a family member’s house, free of charge and then the vehicle will still have it’s exempt characteristic and will not be counted against you for Medicaid coverage purposes, but you also are sure that your vehicle is secure. These are just some things that you want to think about once you’ve already received approval for Medicaid coverage because the Department of Children and Families is allowed to continually review financials at least for one year from the period of eligibility all the way through the review period after that initial year. Keep this in mind.
If you have any other questions regarding Medicaid approval, Medicaid planning or the actual Medicaid application, please give us a call here at Waller & Mitchell at 727-847-2288.