8 Common Mistakes


  1. Gifting, changing title to the home, transferring cash or assets of any type without knowing or understanding the consequences of such transfers.  Making uninformed financial decisions may result in extended periods of ineligibility.
  2. Not taking advantage of all spend down and exemption funding opportunities.  Is there a mortgage that can be paid off?  Are there home repairs that can be made?  Are there items that can be pre-paid?  Have funeral plans been made?
  3. Failing to take advantage of protections for the spouse.  The Omnibus and Reconciliation Act of 1993 provided important protections so the spouse of a Medicaid recipient still living in the community does not have to be impoverished.
  4. Planning too early or too late.  As soon as it is recognized that long-term care services will be required, it is important to begin looking into these matters.  Conversely, just because a person is already receiving care does not mean that Elder Care Financial Planning should not take place.
  5. Assuming Medicaid caseworkers will help with planning.  Beyond completion of the application, Medicaid employees are specifically instructed not to advise clients on many matters.
  6. Not planning for post-Medicaid consequences.  More aggressively then ever, the Federal and respective state governments are seeking repayment of benefits from beneficiary estates.  What will happen when the Medicaid recipient passes away?  What happens when the community spouse passes away either after or before the recipient?  What about the home?
  7. Not considering the tax consequences of financial transactions.  The movement of money often creates taxable events (capital gain, income and/or gift and estate).  Strategically avoiding these taxes or making sure funds are available to pay them should be part of your planning. 
  8. Going it alone.  Elder Care Financial Planning contains a universe of issues. Seek professional guidance.