Indiana Medicaid has specific limits on who is eligible for coverage. Many people in Indiana feel that they fall outside these limits because they make too much money or have too many assets. However, due to the cost of long-term care, Medicaid is not something that can be overlooked. This article explains some misconceptions about applying for Medicaid, including the misconception that you have to be completely impoverished to get long-term care Medicaid benefits.

In Indiana, Can You Still Be Eligible For Long-Term Care Medicaid When Your Income Is Too High?

You can still become eligible for long-term care Medicaid when your income is too high. You can put your monthly income into a special type of trust known as a qualified income trust or Miller trust. A trust of this type, which is irrevocable, allows a trustee to hold your extra income each month (income exceeding Medicaid’s monthly income limits). When your income goes into the trust, Medicaid does not count it against you, even though the trust could be used to reimburse Medicaid at your death.

How Will A Trust Help You Qualify For Long-Term Care Medicaid In Indiana?

Many people think that putting their money in a trust will allow them to qualify for long-term care Medicaid. However, not all trusts are the same – some count against you for eligibility while others don’t. A skilled Medicaid planning attorney can make sense of it all. They may be able to help you create the right kind of trust to become eligible for long-term care Medicaid in Indiana, whether now or in the future.

In Indiana, Can You Still Become Eligible For Long-Term Care Medicaid When You Have Too Many Assets?

You can still become eligible for long-term care Medicaid if you have too many assets. Medicaid divides assets into two categories – exempt and available. Exempt assets do not count towards Medicaid’s asset limits. If an asset is not exempt, it must be liquidated and applied towards the cost of nursing home care before Medicaid benefits may be available.

Indiana 2022 Exempt Assets

The following assets are exempt and do not need to be applied toward nursing home care before Medicaid benefits may be available.

  • $2,000 or less in cash or non-exempt assets if you are single.
  • Personal effects and household goods.
  • One home with a maximum of $636,000 equity in value if:
    • You plan to return to the home,
    • It is under your spouse’s name, or
    • A child under 21 or a disabled person resides in it.
  • One motor vehicle worth less than $5,000 under current market value, unless the vehicle is used for the applicant’s medical treatment, employment, modified to accommodate a disability, or is the primary vehicle of the applicant’s spouse, then it is exempt regardless of value.
  • Dividends from life insurance not exceeding $1,500.
  • Burial spaces and irrevocable burial trusts.
  • Savings bonds interest.

If you have more than five years to plan for Medicaid long-term care, additional options are on the table, such as creating a Medicaid asset protection trust. Specifically, when the state reviews applicants for Medicaid nursing home care eligibility, the state uses a 60-month look-back period to ensure that the applicant’s assets were not given away or sold for less than fair market value to qualify the applicant for Medicaid benefits. If you transfer assets outside of this look-back period, you do not violate Medicaid’s look-back rule.

If Your Income And Assets Are Higher Than The Limits, Should You Still Plan To Apply For Long-Term Care Medicaid In Indiana?

Healthcare is expensive, and Medicaid may help reduce the financial hardships of aging. Many people do not meet Medicaid’s strict income and asset thresholds at first, but much can be done to fix this.

If you are looking to apply for long-term care Medicaid, it can be complicated. Managing your income and assets while applying for Medicaid can seem complex and confusing. Reaching out to an experienced Medicaid planning attorney can relieve you of the stress. They can help you decide the best course of action for your situation. To learn more about planning to apply for long-term care Medicaid, reach out to Hawkins Elder Law at (812) 268-8777 or contact us online.

About The Authors

Jeff R. Hawkins and Jennifer J. Hawkins co-author this blog with Thomas E. Hynes, a lawyer admitted to practice in Pennsylvania, New Jersey and Florida who has a background in estate planning and elder law. Jeff and Jennifer are Trust & Estate Specialty Board Certified Indiana Trust & Estate Lawyers. They are also active members of the Indiana State Bar Association and the Indiana Chapter of the National Academy of Elder Law Attorneys (NAELA). Jeff is also a member of the Illinois NAELA Chapter.

Both Hawkins are admitted to practice law in Indiana, and Jeff Hawkins is admitted to practice law in Illinois.

Jeff is a Fellow of the American College of Trust and Estate Counsel and the Indiana Bar Foundation. He is also a member of the Illinois State Bar Association and he served as the 2014-15 President of the Indiana State Bar Association.

More Information

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