NJ Medicaid Planning
Our nation is getting older and sicker. Age is taking its toll on people’s health and finances. People are fearful of losing everything to a nursing home and the costs of long-term care. With the explosion of Alzheimer’s disease and other debilitating health conditions, it may be time for you to think ahead and have a plan in place in the event long-term care is needed in your future. Our NJ Medicaid Planning attorneys can assist you in making that plan.
If you are medically and financially able to qualify for long-term care (LTC) insurance, look into purchasing that coverage now. I consider LTC insurance one of the most critical insurance policies you can purchase during your 40’s or 50’s when premiums are less expensive.
If you cannot qualify for long-term care insurance due to a medical condition or if the premiums are cost-prohibitive, you should consider asset protection planning far enough in advance to qualify for Medicaid benefits before a crisis strikes. Potential changes in the laws require that families consider planning sooner rather than later. In some cases, five years or more may be needed for your plan to be fully effective. But, if you are in a crisis and must obtain immediate care for a loved one now, there is still time for you to take action to help your loved one qualify for Medicaid and protect a lifetime of assets and income.
How to Meet Medicaid Eligibility
As with any government program, individuals must meet eligibility criteria before they can begin receiving benefits. The Medicaid program requires an applicant to satisfy both medical and financial standards. These requirements are outlined on the following pages.
Financial Eligibility
A single applicant may have $2,000 in countable resources in New Jersey. Yes, $2,000… that’s it. If both husband and wife are applying at the same time, the countable resources cannot exceed $3,000/$4,000 (depending on the program). The key words are countable resources. Here’s where an experienced elder law Medicaid attorney comes to the rescue.
What are countable vs. exempt resources?
Medicaid considers certain resources (often called assets) of the individual or family as exempt from a forced spenddown meaning Medicaid does not factor in exempt resources when making a financial eligibility assessment. Exempt resources are distinguished from countable (non-exempt) resources. In general, the following resources are exempt under the law:
- Your primary residence, under limited circumstances. Planning to protect your home is tricky. Your home must be your principal place of residence. For example, it cannot be a vacation home. The rules are different for a single person. A single person entering a nursing home may be required to show some “intent to return home”, even if this never actually takes place, otherwise the home must be sold. A home is not automatically exempt if you are single. In fact, it is at risk of a forced sale. We can offer you planning alternatives to save your home.
- One car or motor vehicle
- A burial plot(s)
- An irrevocable prepaid funeral plan(s)
- Life insurance, if the face value is $1,500 or less (If it exceeds $1,500 in total face value, the cash value in this policy is countable).
- Most other resources are generally considered non-exempt and are countable for purposes of financial eligibility. These resources include all your money and property that can be valued and converted into cash including, but not limited to the following:
- Cash, checking, and savings accounts
- Certificates of deposit
- U.S. savings bonds
- Retirement accounts including IRA, 401K, and TSA plans (In some instances, the plan of the community spouse may be exempt)
- Nursing home security deposits
- Pre-paid funeral contracts which can be cancelled
- Revocable trusts
- Real estate other than the primary residence
- A second car
- A boat(s) or recreational vehicle(s)
- Stocks, bonds, or mutual funds
- Promissory notes
While the Medicaid rules are complicated, it is safe to say that a single person will only qualify for Medicaid when he or she holds less than $2,000 in countable resources, unless you come and see us for lawful alternatives.
Applying for Medicaid Eligibility For Long Term Care in NJ (Part I)
Applying for Medicaid Eligibility For Long Term Care in NJ (Part II)
ANTI IMPOVERISHMENT LAWS CAN HELP SUPPORT THE WELL SPOUSE WHO LIVES AT HOME OR THE COMMUNITY
The government recognizes that for married couples, when one spouse is ill and one spouse is healthy, a long-term illness may impoverish both spouses. To avoid this result,” certain guidelines have been established to provide additional resources for the care and support of the well spouse who lives at home and in the community. This additional allowance of resources for the at-home spouse is known as the Community Spouse Resource Allowance (CSRA).
The CSRA allows the well spouse to keep one-half of the countable resources with a minimum of less than $30,828 and a maximum of $154,140. For example, if a married couple has less than $30,828 in countable resources, the allowance for the community spouse is $30,828 (minimum). If the couple has $100,000 in countable resources, the allowance for the community spouse is $50,000. If the couple has $260,000 in countable resources, the allowance is $130,000. The minimum and maximum amounts provided here are effective for 2024 and are updated each year.
Once exempt resources have been determined and a community spouse resource allowance has been applied, any remaining resources are subject to spend down. (The spend down process is explained under the Frequently Asked Questions section of this site.)
Do You Need a Medicaid Planning Attorney to Help With the Medicaid Process?
Whether you need a Medicaid Planning Attorney depends upon your situation. The following checklist will help you decide if a consultation will be of benefit to you and your family:
- Is the applicant single, but has more than $2,000 in assets?
- Is the applicant married, and has more than $29,724 in assets?
- Do the applicant’s assets include Life Insurance, Annuities, Long-Term Care Insurance, Real Estate (including a Residence), Stocks, Bonds, Business Property, and/or retirement plans (i.e., 401K, 403(b)) or IRAs?
- Has the applicant or his/her spouse gifted or transferred any cash, bank accounts, real property, or personal property (i.e. something other than typical birthday and Christmas presents) to another person within the last 60 months? This includes placing another’s name on any real property or bank accounts, etc.?
- Although the applicant may have enough income and assets to currently pay for his or her care needs, is the applicant expected to be paying for long-term costs within the next 12 months?
- Does the Medicaid applicant want to legally protect assets for a spouse or child(ren), particularly a disabled child or grandchild?
If a majority of the answers to these questions are yes, then you should seriously consider a consultation with Fredrick P. Niemann, Esq. You can contact him concerning eligibility for NJ Medicaid or applying for Medicaid approval in New Jersey by calling toll-free (855) 376-5291 or email fniemann@hnlawfirm.com.
His team of experienced lawyers and paralegals have filed many hundreds of applications throughout New Jersey. You’ll find Hanlon Niemann & Wright to be one of the most friendly and compassionate law firms anywhere, especially in New Jersey.