They say “Home is where the heart is.” In Michigan Medicaid planning this is doubly true. To qualify for Medicaid in Michigan you are only allowed to keep $2,000 in countable assets as an individual, which as an Oakland County elder care attorney always throws clients for a loop. Then from there only $60 per month in income. This doesn’t provide much in terms of resources to have any quality of life. That’s why many families looking to a Michigan elder care lawyer to help protect as many resources as possible from the devastating effects of long-term care costs.
Other than Veterans Benefits, which are a great planning tool if available, there are really only three ways to pay for long-term care. That is, you can private pay, you can use long-term care insurance, or you can turn to the Medicaid program. In previous posts, I’ve outlined the issues that are popping up with looking to long-term care insurance as a way to pay for long-term care costs. So, more and more people are looking to Michigan Medicaid.
So, if you’re only allowed to keep $2,000 in countable assets, what does that mean for the family home, the primary residence. Well, the family home is probably going to be a non-countable or exempt asset. What this means, is that if a Medicaid applicant were to apply for Medicaid, the house would not have to be “spent down,” assuming the home was in the applicant’s name (not a revocable living trust).
So the house is protected and all is well, right? Not so fast. How are you going to pay the expenses for the house? Who’s going to keep the house up, mow the lawn, etc? That $60 a month won’t pay all the bills will it? Then what happens when the Medicaid applicant passes away.
Now you face Michigan Estate Recovery. Did you take the right planning steps prior to the Medicaid applicant passing away? Did you use a Michigan Legacy Deed?
Often times the family home is the asset that has the most sentimental value in it for a family and unfortunately, it can be one of the most difficult assets to properly plan for when you’re looking at Medicaid planning. That is why it is important to work with an elder law attorney as you try to navigate the confusing long-term care legal maze.