Any of the articles and/or suggestions presented in said articles on this site are legal. I could never propose an estate planning and/or asset preservation technique that was not. The best example would be simply hiding money, assets or income. This will get you in hot water with the law should you decide not to include assets during the Medicaid qualification process. This is, without question, fraudulent activity against many governing bodies including the State and Federal government and could incur grave legal consequences. I always instruct my clients – “We cannot help you protect and/or preserve your assets if we do not know about them or if they are hidden from us.” Not to be redundant, but this is a serious no-no. However, rest assured that there is an abundant amount of other options that are completely legal and ethical for estate planning and nursing home Medicaid. These options, based on your specific factual scenario, will help you achieve your goals with the peace of mind that you are doing so legally and ethically. Now that we have discussed the legality of the methods set forth in these articles, let’s move on to the question of ethics.
Many individuals question Medicaid specialists who preserve and protect clients’ assets and obtain Medicaid qualification for said clientele. Many believe that Medicaid was a system set up for the poor and not as a way for hard-working families to pass their hard-earned savings and assets onto their heirs. To further this discussion, I would like to provide some real world examples.
Example 1: Both Jeremy and Bonnie are residents of the State of Florida. Both of them are the same age, 79 years old. Both of them need to be in a nursing home or long term care facility. Moreover, both of them have made the exact same amount of money over their working lifetime. However, they do have differences. Bonnie, throughout her life has been frugal and fiscally responsible. She has always driven the same car until it was driven into the ground. She cut coupons, did not smoke, party, gamble or spend money on unnecessary items. Don’t get me wrong, she did occasionally take that well deserved vacation and sometimes even splurged on a bigger television than she needed. But, her main focus revolved around saving her money to pass on as a legacy. She desired to leave her children and grandchildren better off than she was. In fact, she was able to save over $300,000.00 through her hard work and sacrifice!
Now Jeremy, he was the polar opposite. Though he made the same exact amount of money as Bonnie over their working lifetimes, he squandered his money. He took frequent trips to Las Vegas, gambling away savings. He bought expensive cars, dined and drank at the most luxurious restaurants, and impressed his friends and women with the newest and hottest material possessions. Jeremy has saved nothing and is the epitome of fiscal irresponsibility.
Both Bonnie and Jeremy are entering the nursing home at the same time. Jeremy, as he has no countable assets or income to speak of, is automatically eligible for nursing home Medicaid qualification which will pay his bills. Bonnie, diagnosed with Alzheimer’s, has to private pay the nursing home as she is not eligible for nursing home Medicaid qualification based on the assets she has saved and her income. Bonnie has $300,000.00. The nursing home where she resides costs $90,000.00 per year. Tragically, Bonnie will be out of money in 3 and 1/3 years. Only then will she be eligible for nursing home Medicaid qualification, after all she has saved and worked for is gone. Bonnie puts up a good fight and, after four years, passes away. She passes, broke, and with nothing left to leave as a legacy that she was so responsible and disciplined in saving throughout her lifetime.
Lesson: Jeremy is incentivized for his squandering and extravagant lifestyle. Neither Jeremy nor his heirs have to pay anything for his care. Bonnie is penalized for her sacrifice and fiscal responsibility. Ultimately, leading to her impoverishment and inability to leave the legacy she spent a lifetime building.
Example 2: Enter Fred. Fred is in the exact same position as Bonnie and Jeremy. Same age, same amount of money made over his working life, and also needs to go into the same nursing home at the same time. Fred, like Bonnie, was disciplined financially throughout his life and worked hard to save $300,000.00. He too wanted to leave a legacy with dignity. Fred decided to hire Elder Planning Alliance for purposes of estate planning, nursing home / ICP Medicaid, and asset preservation. Elder Planning Alliance, being knowledgeable in the aspects of nursing home Medicaid qualification and estate planning, was able to legally and ethically preserve Fred’s $300,000.00 and qualify Fred for nursing home Medicaid. Fred received the exact same care as both Bonnie and Jeremy. However, the assets he worked so hard for were passed to his loved ones based on his desires. Is Jeremy more ethical than Fred because he squandered all his money and had the government pay for his care? Is Jeremy more ethical than Fred because Fred availed himself of the regulations set by the State and Federal government and thus allowed him to keep the fruits of his labor to pass on as his legacy? My answer to these questions is NO.
At Elder Planning Alliance, we will assist you in ethically and legally availing yourself of the laws, regulations, policies, statutes, and provisions as put into effect by the government so you too can leave the legacy you have fought so vigorously to build. Please call the team at Elder Planning Alliance for your free initial consultation, toll free, at 1.866.372.2702.