If you are approaching the age when health issues have you thinking about an eventual move into a Delaware nursing home, you need to become aware of the high cost associated with such care and determine how you will cover it. Unfortunately, very few people can afford to personally pay for long-term nursing home care, and you may have no other option than to apply for Medicaid. 

As US News reports, however, Medicaid assistance comes with demanding eligibility rules to which you must strictly adhere. For instance, you can own no more than $2,000 in assets as an individual and $4,000 in assets as a couple if you and your spouse will need to make a joint Medicaid application. Since you undoubtedly own considerably more property and assets than that, you may wish to consider conducting a Medicaid spend-down. 

The whole idea of a Medicaid spend-down is to “impoverish” yourself so as to qualify for Medicaid assistance. While you can legally do this, you need to be very careful as to how and when you go about it. In terms of the how, you can establish an irrevocable trust that names you as the beneficiary and into which you place all of the assets you currently own. Once so transferred, you no longer own those assets yourself. The trust owns them. Consequently, you should give considerable thought to the person you designate as the trustee because you will be completely dependent on him or her to provide you with enough money to live on. 

Look-back period 

The trickiest part of a Medicaid spend-down is when you do it. It may surprise you to learn that when you apply for Medicaid benefits, the government can and will review all of your financial transactions during the past five years. Should they find one or more that look like a deliberate impoverishment tactic, they will deny your application. Therefore, if Medicaid assistance appears to be a necessity in your future, the sooner you contact a knowledgeable attorney and begin your Medicaid spend-down the better. 

This is general educational information and not intended to provide legal advice.