MEDICAID PLANNING IN NEW JERSEY
Written by Fredrick P. Niemann, Esq. of Hanlon Niemann & Wright, A New Jersey Medicaid Attorney
WHY PLAN FOR MEDICAID IN NEW JERSEY?
Our nation is getting older and sicker. Age is taking its toll on people’s health and their wallets. People are fearful of losing everything to a nursing home and long term care. With the explosion of Alzheimer’s disease and other debilitating medical conditions, it is important to think ahead and have a plan of action in place in the event long-term care is needed. If you are medically and financially able to qualify for long-term care insurance, look into purchasing that coverage now.
If you cannot qualify due to a medical condition or if the premiums are cost-prohibitive, you should consider asset protection planning now to qualify for Medicaid benefits before a crisis strikes. Changing laws are requiring smart families to plan sooner rather than later, in some cases, five years before help is needed in order to be fully effective. Even so, if you are in a crisis situation and must obtain immediate care for a loved one there is still action you can take now to help your loved one qualify for Medicaid and protect assets and income.
As with any government program, individuals must meet certain eligibility criteria before they can begin receiving benefits. The Medicaid program requires the applicant satisfy both medical and financial standards. These requirements are outlined on the following pages.
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) in New Jersey. 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 (assets) of the individual or family as exempt and does not include exempt resources when making a financial eligibility assessment. Exempt resources are distinguished from countable (non-exempt) resources. In general, the following resources are the primary exempt resources under the law:
- Home, under limited circumstances. Planning to protect your home is tricky. The home must be the principal place of residence. A single person entering a nursing home may be required to show some “intent to return home”, even if this never actually takes place. A home is not automatically exempt if you are single. In fact, it is at risk of being forced to sell. We can offer you planning alternatives.
- One vehicle
- Burial plots
- Irrevocable prepaid funeral plans
- 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).
- All other resources are generally considered non-exempt and are countable for purposes of financial eligibility. These resources include all money and property that can be valued and converted into cash including, but not limited to:
- 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 accounts
- Pre-paid funeral contracts which can be cancelled
- Real estate other than the primary residence
- Second car
- Boats or recreational vehicles
- 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 THE WELL SPOUSE WHO LIVES AT HOME OR THE COMMUNITY
The government recognizes that for married couples, where one spouse is ill and one spouse is well, a long-term illness may impoverish both spouses. In an effort to avoid this result,” certain guidelines have been established to provide additional resources for the care and support of the well spouse. 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 $23,844 and a maximum of $119,220. For example, if a married couple has $23,184 in countable resources, the amount of the allowance for the community spouse is $23,844 (minimum). If the couple has $100,000 in countable resources, the allowance would be $50,000. If the couple has $220,000 in countable resources, the allowance is $115,920 (the maximum). The minimum and maximum amounts provided here are effective for 2015-2016 and are updated each year.
Once the 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 specific situation. The following checklist will help you decide if a consultation with Fredrick P. Niemann, Esq. will be of benefit to you and your family:
- Is the applicant single, but has more than $22,000 in assets?
- Is the applicant married, and has more than $24,000 in assets?
- Does 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)?
If the answers to these questions are generally yes, then you should seriously consider a consultation with Fredrick P. Niemann, Esq. You can contact him on any questions concerning eligibility for NJ Medicaid or applying for Medicaid approval in New Jersey by
calling toll-free (855) 376-5291 or email firstname.lastname@example.org.
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.