Planning Tips for Virginia Medicaid Long-term Care

Planning Tips for Virginia Medicaid Long-term Care

Many people are confused about government benefits for long-term care and how to plan ahead for this possibility in their future. The U.S. Department of Health & Human Services estimates that around 70% of those age 65 will require some form of long-term care. One research study revealed that two-thirds of respondents expect for government programs to cover most or all of their long-term care costs. Advance planning for Virginia Medicaid Long-Term Care is essential to make sure you can get the benefits you need when you need them.

Facts About Virginia Medicaid Long-Term Care

Nationwide, Medicaid through the various states is the single largest payer of long-term care costs, but there are strict asset limits and other rules to qualify for these benefits. Understanding these rules is important, especially if it’s possible that one spouse will need long-term care while the other remains at home. Here are some important facts about Virginia Medicaid Long-Term Care.

Exempt Assets – Medicaid caps the amount of assets an eligible person can have to qualify. Some assets are exempt, or non-countable toward your qualification for Medicaid. These include:

  • Personal home (if married and the spouse resides in the home)
  • A vehicle
  • Household furnishings
  • Personal belongings
  • Irrevocable burial trusts
  • Irrevocable Medicaid Trusts

Countable Assets – These are the assets that are included in Medicaid eligibility calculations, and they include such common assets as:

  • Real estate (not the primary home)
  • Additional vehicles
  • Cash over $2,000
  • Stocks, bonds, investments
  • IRAs
  • Checking and savings accounts

Community Spouse Resource Allowance – This is the asset amount a healthy spouse can retain, even if the spouse requiring long-term care qualified for Medicaid. In 2023, the CSRA allows the non-applicant spouse (often called the community spouse) to retain 50% of the couple’s assets, up to a maximum of $148,620. If the non-applicant’s portion of the assets falls under $29,724, 100% of the assets, up to $29,724 can be retained by the non-applicant.

Lookback Period – This is the period of time immediately preceding an applicant’s Medicaid Long-Term Care application date. Medicaid checks to see if any assets were given away or sold for less than market value during this period in an attempt to meet the asset limit. In Virginia, this lookback period is five years. Violating the lookback rule causes the applicant to suffer a penalty period for eligibility.

The rules are complicated, and many people make two major mistakes: they spend more of their assets than they should, or they violate Medicaid rules and suffer stiff penalties. Both these mistakes can be avoided by getting help from an experienced Virginia Medicaid Planning Attorney from Promise Law.

Top Planning Tips for Virginia Medicaid Long-Term Care

The absolute number one best planning tip for Medicaid Long-Term Care is to start early. Planning ahead before the five-year lookback period allows you to make significant choices to protect your assets, including:

  1. Irrevocable Medicaid Trust – The best strategy for advance planning is to use this type of Trust. You can place any assets into this type of Medicaid-approved trust before the lookback period and they are exempt from Medicaid eligibility calculations. It can also protect your home from Medicaid Estate Recovery. Plus, you still can retain control over or change the trustees and beneficiaries.
  2. Gifting – You can gift an unlimited amount to your children or others before the 5-year lookback period begins, and the earlier the better. Of course, this may affect your tax planning. And, the biggest drawback is that you have no control over what happens to the assets gifted. In other words, the recipients never have to use these funds to help you. You should consult with a Medicaid Planning Attorney before using this strategy.
  3. Create a Medicaid-qualified annuity – This is quick and easy, too, but the rules are strict and include making Virginia the beneficiary. These annuities are more commonly used in crisis planning.

Even if you are within the 5-year lookback period, there are still some actions you can take. These include:

  1. Replace your vehicle or purchase one if you don’t have one
  2. Purchase a pre-paid plan to cover your funeral expenses
  3. Invest in new furnishings for your home
  4. Make improvements to your home to make it easier to live in if you need in-home nursing care
  5. Prepay estimated income taxes or capital gains taxes

These and other strategies can protect your assets and savings, and change the way Medicaid Long-Term Care views your financial situation so you legally qualify for coverage.

Get Help with Virginia Medicaid Long-Term Care Planning

Working with an experienced Virginia Medicaid Long-Term Care Planning Attorney can help you and/or your spouse qualify for Medicaid LTC while preserving resources for the well spouse or future generations. Begin by viewing Promise Law’sfree Medicaid workshop. The workshop is available on-demand and provides an explanation of the essential rules to understanding Virginia Medicaid Long-Term Care. We also offer a free initial consultation to discuss Medicaid LTC planning.



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