Medicaid Planning – Is it legal? – Is it Ethical?
When the time has passed when a family is able to qualify for and/or afford the purchase of long-term care insurance, but it’s imperative to find a proper care provider and payment plan for a loved one, where can you turn?
Medicaid – The “Safety Net”
Medicaid is defined as being the joint federal-state program for the medical care of certain needy populations within the United States. While the program is established and partially funded by federal law, it is administered by each individual state.
“Medicaid Planning” (the arranging of financial and legal affairs to obtain Medicaid benefits) has obtained somewhat of a bad stigma, both for the middle class individuals who utilize its benefits and the professionals who assist in obtaining those benefits. While most people have little objection to Medicaid covering nursing home expenses for the poor, some people do object to attorneys and planners who advise their clients on how to “save the family assets” and qualify for Medicaid. The individuals who object, for the most part, seem to think that Medicaid is a type of welfare program that should only be available for those who are at the poverty level. They seem to feel that middle class individuals and couples should not be allowed to “use the system” in order to pass on their assets at the taxpayers’ expense. However, when faced with the a similar situation in their own families, these same objectors will frequently look to the Medicaid system to protect family assets.
Medicaid Planning – Is It Legal?
While I am not an attorney and therefore am not qualified to determine and then advise regarding the legality of any matter, it would seem logical that the fact that Elder Law attorneys and other lawyers engage in Medicaid planning every day, and the fact that the Florida Supreme Court recently determined that only attorneys admitted to the Florida Bar can engage in the “Medicaid Planning” portion of the application process in Florida, and that Medicaid planning is engaged in at some level in all 50 states and the territories of the United States, it is reasonable to deduce that in general; Medicaid Planning as a concept is legal. Obviously each circumstance is different and the specifics of each case would determine the legality of a particular set of facts and circumstances.
Medicaid Planning – Is It Ethical?
Just because something is legal does not mean it is ethical. And, I won’t tell anyone what ethics or morals to embrace. I also won’t tell anyone to compromise his or her values for a dollar. Each person has to make a decision about what is or isn’t ethical or moral. What I will do, however, is offer some perspective.
The generation that is now or soon may be the typical nursing home resident has sacrificed a great deal for this country. Many have served in our military during wartime, paid into a system that promised to care for their most basic needs in old age, and put God, family, and country ahead of virtually everything else.
Those entering nursing homes with assets have likely scrimped, saved, and sacrificed for decades and have managed to save a modest nest egg in spite of high taxes and crooked politics. They have paid their fair share and have carried those who couldn’t – or wouldn’t – work. When these same responsible people need nursing home care the system requires them to spend what they have worked so hard to save before they are able to gain “public assistance.” Yet, the same people that they paid to carry for decades, that saved nothing, and have contributed the least to society, can once again gain assistance for the exact same nursing home care with no sacrifices at all.
So, only you can determine if Medicaid planning is ethical.
Consult a Professional
If your family should decide to protect its assets, a qualified Medicaid application processor and attorney working together will use the rules that were created by the system to your family’s best interest. In my opinion, asset protection planning is every bit as valid as income tax planning – which we all do without any hesitation at all. The Medicaid rules must be followed, but ignoring the rules to your family’s detriment is unnecessary.