Medicaid Planning 101: 4 Steps to Follow to Get Insured

Medicaid Planning, also known as “Asset Protection Strategies,” has become more prevalent in recent years. It has become a widely used method to protect an applicant’s income and assets from Medicaid spend-down requirements during the application process. 

Medicaid Planning is not an easy process. There are a lot of medical directives and legal paperwork that need to be done by a professional, and it is essential to get someone experienced to help with the planning, e.g., a Medicaid Planning attorney. KST trust has decades of experience in Medicaid Planning. For more information, visit the site here.

1) Apply for Medicaid

Medicaid application rules vary from state to state. However, one rule is consistent through all states: you must be either impoverished or utterly destitute to qualify for Medicaid benefits. So, if you are interested in Medicaid Planning or Medicaid Asset Protection, the first step is to apply for Medicaid. 

The purpose of this step is to open a “Medicaid Case.” This is a case number assigned to the Medicaid recipient. This case number will be used on all future applications and appeals related to Medicaid. It does not matter who fills out the application, whether you or your representative. What matters is that at least one applicant applies for Medicaid and provides all necessary required information and documentation.

2) Transfer Assets

The next step is to transfer assets into an irrevocable trust. This must be done to qualify for Medicaid. Trusts are irrevocable in that the applicant cannot access the purchases placed into the trust for their use. The trustee has control over the assets held in the faith. This is done to ensure an applicant does not spend their own money on a Medicaid applicant’s care.

An irrevocable trust is a trust that the trust’s grantor cannot change after it has been set up. This means that the grantor does not control the assets held in the faith. The trustee has control over these assets but must follow all of the trust rules. An irrevocable trust is frequently used in Medicaid Asset Protection Planning to shelter an applicant’s income and assets during the application process.

3) Plan to Get Uninsured

After transferring an applicant’s assets, a plan must be developed to get the applicant “uninsured”. This is done by sheltering income and assets. It also provides a method for how an applicant will maintain their income and assets with or without Medicaid coverage.

4) File for Reimbursement of Expenses Paid by Medicaid

After the application process is complete and an applicant has received Medicaid benefits for some time, it may be possible to file for reimbursement of expenses paid by Medicaid.

The reimbursement process begins by applying for a “Medicaid Hearing.” If the Medicaid department approves the hearing, an applicant may be reimbursed for expenses paid out of pocket. This process can take some time, but it can return thousands of dollars to an applicant if successful.

Conclusion

The above process is the barebones of Medicaid Planning. Every state’s application and hearing processes are different; however, the above outlines the general rule for being qualified for the Medicaid insurance program. The steps must be done in order and can’t be skipped.