Medicaid Planning: What Seniors Need to Know
Medicaid planning can help you get accepted into the program and receive coverage for services and care that Original Medicare doesn’t cover.
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Medicaid is a jointly run federal and state health insurance program. Medicaid financial eligibility rules vary from state to state. This can make it challenging for seniors to know if they’re eligible and whether they can use Medicaid to pay for things Medicare doesn’t cover, like long-term care.
Medicaid can be cumbersome to apply for, especially if you have financial assets that require restructuring. No matter what your marital status, financial situation, or lifestyle, Medicaid planning can make all the difference between getting accepted or rejected for this program.
In this article, we’ll explain what Medicaid planning is. We’ll also talk about the different types of Medicaid planners you may wish to use and strategies that can help ensure your eligibility.
Pro Tip: Medicare and Medicaid have differing eligibility criteria, and provide different types of coverage. Check out our guide to learn more about the differences between Medicare and Medicaid.
Table of Contents
What Is Medicaid Planning?
Medicaid planning is the process of learning about, and applying for, Medicaid. This process requires that you gather documentation and forms. These may include:
- Tax returns
- Proof of citizenship or immigration status
- Proof of state residency
- Information about household demographics
Your age, disability status, and other criteria may impact the agency you should apply through.
In most states, your eligibility will be determined through the use of Modified Adjusted Gross Income (MAGI) Rules.1 People whose assets exceed the limits determined by Medicaid can go through Medicaid’s mandatory spend-down process. Because Medicaid eligibility rules are complicated, many seniors find it helpful to work with a Medicaid planner.
Types of Medicaid Planners
There’s a wide range of professionals who can help with Medicaid planning. Some are volunteers, and others are hired professionals. The rates you’ll pay for professional services vary significantly based on the type of professional you hire and your location. Like everything else, these rates tend to go up over time (another good reason for planning early!).
Medicaid planners can help you protect and maintain your assets during the mandatory Medicaid spend-down process. They can also help you apply for Medicaid if you require nursing home care but lack the funds needed to pay for it.
Based on your needs, you may be best served with a social worker, financial planner, or lawyer who specializes in Medicaid planning. If you’re in the hospital and wish to go directly into a long-term care facility, staff at both locations should be able to offer Medicaid planning assistance.
Examples of fee-based Medicaid planners include:
Certified Medicaid Planner (CMP): CMPs often have an insurance or accounting background. Many are also licensed social workers. These highly-trained professionals have a deep knowledge of how Medicaid works and what you need to do if your assets or income exceed the limit set by Medicaid in your state. They’re also specially trained to work with individuals who need long-term care assistance.2
CMPs are a good choice for people who need to spend down their assets. Typically, these professionals have an hourly rate that is less expensive than attorneys.
Elder Law Attorneys: If you already have an estate planning attorney, they may be able to help you navigate the ins and outs of Medicaid eligibility. If you’re starting from scratch or feel that your current legal representation doesn’t fit this particular bill, you may be best served by finding an elder law attorney. This may be the best choice for you if you have a stock portfolio, significant holdings, or a complicated tax return.
Elder law attorneys can establish an asset protection trust or a pooled income trust on their client’s behalf. These trusts can be used to protect your income, spouse, home, and heirs.3
Attorneys are typically the most expensive types of professionals who can help with this type of planning. Make sure you choose an attorney who is licensed to practice law in your primary state of residence.
Geriatric Care Managers (GCM): These professionals are also called Elder Care Managers or Life Care Managers. They typically have a health or social services background. GCMs can help you and your family navigate applying for Medicaid. They may make recommendations based on your or your loved ones’ needs, such as memory care coverage, assisted living, or at-home health care. GCMs can also provide support recommendations for the family of the person being treated.
GCMs are paid-for professionals who are often hired through management services agencies. They’re not legal or financial specialists, in most instances. Unless they’re licensed to do so, GCMs can’t file legal paperwork on your behalf or establish trusts.
Free Medicaid Planning Assistance
If your Medicaid planning needs are straightforward, you may be able to work with a volunteer Medicaid planner. Of course, this may represent a significant cost savings for you and your family.
Volunteers can be highly experienced and knowledgeable about the application process for Medicaid. They won’t be able to make legal or other types of arrangements for you, but they can be highly beneficial for supporting you through the application process.
Types of volunteer Medicaid planners include:
Case Managers: These professionals are also referred to as Public Benefits Counselors. They are often employed by government-run or not-for-profit agencies that serve seniors. Some examples of this are state-run Offices for the Aging (such as New York Office for the Aging) or local Area Agencies on Aging. This Eldercare Locator can help you find free Medicaid planning support in your state. You can also reach out to your local library or local elected representatives to get information on how to locate these types of agencies.
State Health Insurance Assistance Program (SHIP) Counselors: SHIP agencies have volunteers on staff who can counsel you on the application process for both Medicaid and Medicare. They can also work with you on determining your eligibility for a Special Needs Plan that encompasses coverage through both programs.
SHIP Counselors are a good choice for people who are not sure what type of insurance needs they have. They will not be able to give legal, financial, or medical advice. In some instances, they may provide a great jumping-off point for you to figure out your next steps.
Did You Know? You may be eligible to get Medicare and Medicaid simultaneously through a Dual Eligible Special Needs Plan (D-SNP).4 A Medicaid planner can help you determine your eligibility.
Who Is Eligible for Medicaid?
To be eligible for Medicaid, your income and resources must be below specific asset limits. The types of assets you can keep, as well as their value, vary from state to state. Pensions, salary, stock portfolios, and life insurance may all be taken into account when you apply.
Did You Know? Term life insurance doesn’t affect Medicaid eligibility, but whole life insurance may.5 Read our comprehensive life insurance guide to learn more.
The most valuable asset you have may be your home. In many instances, seniors can own their own home and still be eligible for Medicaid. For many, this is a big relief, especially if you’re married and only one of you requires nursing home care.
There are many different types of Medicaid plans. For example, some plans are geared toward the needs of people with permanent disabilities, like blindness. Others are meant to help people age in place successfully. Still, others are for those who would benefit from living in a facility, like a nursing home. Figuring it all out can be confusing. That’s why Medicaid planning is essential.
Pro Tip: Learn about care homes and assisted living options for blind seniors.
Final Thoughts
There’s an old saying: “The best day to plant a tree is 50 years ago. The second best day is today.” The sooner you can start planning for Medicaid enrollment, and figuring out what’s possible, the better. But even if you’re “behind the eightball” so to speak, don’t panic. Planning provides knowledge. And knowledge alleviates anxiety. The more information you have about Medicaid and your eligibility, the better served you will be, no matter when the need for this coverage arises.
New York State Department of Health. (2024). How to Apply for NY Medicaid.
Certified Medicaid Planner. (2024). Welcome to the Certified Medicaid Planner™ program.
Landskind & Ricaforte. (2024). How to Gift Assets Without Risking Your Medicaid Nursing Home Benefits.
Medicare.gov. (2024). Special Needs Plans (SNP).
American Council on Aging. (2024). The Impact of Term Life Insurance and Whole Life Insurance on Medicaid Eligibility.
