The Danger of Doing a Medicaid Application Without an Attorney
September 21st, 2015 by beasleyferber
The experience of a client in a recent case is a textbook example of how doing things “on the cheap,” and not having an attorney represent you in a Medicaid application can be a disaster.
A few years ago, we did an irrevocable Medicaid trust for a husband and wife. They put their home and an investment property into the trust, and left their monetary assets outside of the trust. They did this because they specifically wanted to protect their property from the costs of long-term care. About five months ago, the wife went into a nursing home. Over the years, we have sent our clients numerous letters advising them to contact us if a spouse or parent were to go into a nursing home. This gentleman, however, did not not do so. He went to the Medicaid authorities on his own. The Medicaid caseworker then made a mistake — she put both pieces of real estate in to the “countable asset” column, when she should not have done so, as they are protected by the trust. By this time, a few months had gone by, and the client had been paying the monthly nursing home bill all along. He went to a local attorney, who was not versed in Medicaid law, for assistance. The local attorney did the right thing: Knowing that Medicaid was not his expertise, he called us. We told him that Medicaid had made a big mistake, and that it had to be corrected right away. The other attorney sent the client back to us.
We met with him, and respectfully pointed out that he had made a mistake in going to the Medicaid authorities unassisted. Although he did not come out and directly say so, through our discussion it became clear that he failed to contact us intentionally, because he did not want to pay any more legal fees. This was a very costly mistake on his part. Had he retained us, we would have pointed out to Medicaid that the properties were not countable assets, and we would have put in place an immediate annuity which would have made his wife eligible for Medicaid almost immediately. Had he done this, he would have paid the nursing home perhaps one month of fees (while we were putting the paperwork together) and then his wife would have been Medicaid eligible. However, the result of his going to Medicaid unrepresented was that he paid an extra five month’s worth of nursing home bills that he otherwise would not have had to pay.
This is a tragic example of being, as the old saying goes, penny wise and pound foolish. don’t let it happen to you.