Ohio Medicaid Planning

Ohio Medicaid Planning

Ohio has its own set of complicated Medicaid rules that are applied in determining Medicaid eligibility. It is critical to know these rules in order to both gain eligibility and also to maximize one’s ability to protect assets from the Medicaid spend down process.

Most parents want to pass down to their children as much of their accumulated wealth as possible. However, in order to completely remove these assets from the Medicaid process, they must be transferred at least 5 years prior to the Medicaid application process. Both parents must give up complete ownership control. Although this is clearly an option, many individuals do not want to give up complete control over their assets. If you do, an irrevocable trust may be the best answer. If such a transfer is made, one must be very careful that he or she has a plan to pay for the next 5 years of medical care because, otherwise, an improper transfer will be deemed to have been made and Medicaid will be denied.

When applying for Medicaid, it is important to maximize the use of the applicant’s assets. Medicaid looks at the assets of both the applicant and spouse, if married. However, certain assets are considered exempt. These include the house, if the community spouse (the non-institutionalized spouse of an institutionalized spouse) is residing there, one car of unlimited value, and both spouse’s funeral and burial expenses. The community spouse is also allowed to retain half of the remaining assets up to a certain amount. The remaining balance must be spent down on behalf of the applicant. However, the amount to be spent down can also be applied to exempt assets. This means it can be used to pay off a mortgage, make improvements to the house, upgrade the family vehicle, and prepay the funeral expenses of the community spouse and Medicaid spouse. This is a much more efficient use of the money than just applying it to the Medicaid spouse’s nursing home care.This means it can be used to pay off a mortgage, make improvements to the house, upgrade the family car, and prepay the funeral expenses of the community spouse and Medicaid spouse.  This is a much more efficient use of the money than just applying it to the Medicaid spouse’s nursing home care.

It is also important that the community spouse has properly updated his or her estate planning documents. The last thing a couple wants is to segregate their assets, spend down the Medicaid spouse’s share, gain eligibility for Medicaid, and then have the community spouse die first and leave their money to the Medicaid spouse. Then the Medicaid spouse is kicked off of Medicaid until this money is also spent. It is important that the community spouse not only changes his or her will, but also to have his or her assets configured in such a way to avoid the probate process entirely. This can be done through beneficiary designations or trusts. Even if the Medicaid spouse is disinherited in the will, if any probate assets exist, Medicaid will force the Medicaid spouse to elect to take against the will in order to acquire some of the deceased community spouse’s assets.

Ohio Medicaid Planning Rules And Loopholes

Over the past decade, Medicaid rules have gotten more and more restrictive and many “loopholes” have been closed. However, if you know the Medicaid rules and regulations, often there are things that you can do to maximize the use of your assets and your spouse’s and maximize the ability to pass on some of these assets down to your children. Talking with an elder law attorney about these issues is critical in this planning process. A mistake could result in an improper transfer deemed to have been made and Medicaid eligibility being denied.

Attorney Joseph E. Balmer is one of only 20 area lawyers certified by The Ohio State Bar Association as a specialist in estate planning, trusts and probate administration.  Click here to read his biography page. Please don’t hesitate to call us at (937) 293-2141, or email us by using our form below if you want to discuss any Medicaid planning issues.  Additionally, we have an emergency phone number, (937) 760-4357, that is answered by one of our Ohio Medicaid planning lawyers around-the-clock.