Medicaid Planning: Leveraging Your Options
For those nearing their later years, Medicaid is often a critical component of long-term care planning. It provides comprehensive coverage for medical care, prescription drugs and skilled nursing care. Given the astronomical costs of nursing home care, Medicaid is a cornerstone of long-term care planning.
The Michigan Medicaid Health Care Program has complex eligibility requirements. There are many nuances to qualifying for Medicaid. Accordingly, it’s wise to speak with a knowledgeable attorney about your options.
At the Kalamazoo law firm of DeMent & Marquardt, PLC, our lawyers can help. They understand the complicated process of Medicaid planning. One of our attorneys, who is well known for his knowledge in this area, has authored numerous articles on the subject. Our lawyers can guide you through the process and help you leverage all your options to maximize your benefits without draining your savings and assets. They focus a major part of their practice on this and other aspects of elder law.
Dispelling Myths About Medicaid
Medicaid has income and asset limits that are frequently misunderstood. Many people believe that they will have to spend down all their assets in order to qualify. Fortunately, that isn’t always the case.
There is also much confusion about the Medicaid look-back periods. When applying for Medicaid, any gifts or asset transfers below fair market value that happened in the last 60 months may be treated as part of the applicant’s estate, which will impact their eligibility.
The important thing is that you have options, and it’s well worth exploring them. Our lawyers can help you sort through the intricacies of the look-back period and other eligibility issues.
What Are The Benefits Of Michigan Medicaid Planning?
Medicaid planning helps preserve assets for your family and leave behind a legacy for your selected beneficiaries. Asset protection can reduce the value of your personal estate, while still keeping important assets in the family.
There is a five-year look-back period for Medicaid eligibility, so planning allows you to be proactive so that you do not trigger a look-back penalty that can affect your ability to receive critical benefits. You can often spend down your nonexempt assets by making home repairs, paying off existing debts or purchasing assets that will be exempt.
Medicaid planning also permits you to take steps that will protect your spouse (known as the “community” spouse) if you enter nursing care, but they remain at home. The right strategy today can allow them to retain certain assets without affecting your eligibility.
What Considerations Do Elderly Couples Need To Make With Medicaid Planning?
First, married couples need to consider their exempt assets. These include a primary residence with a value up to $752,000 in 2026, burial plots and prepaid burial expenses, some personal belongings and a primary vehicle.
Next, couples should consider the community spouse resource allowance, which allows a spouse to keep 50% of the countable (nonexempt) assets the couple owns jointly. As of 2026, it is capped at $162,660.
Income is also protected under Michigan law, using the Minimum Monthly Maintenance Needs Allowance (MMMNA). As of 2026, the total per month is $2,643.75.
How Can You Pay For Long-Term Nursing Home Care?
Nursing home care can be expensive. Common options to cover costs include:
- Private payment with savings and personal financial assets
- VA benefits for former military members
- Long-term care insurance
Medicare can only be used to cover these bills for 100 days. With this in mind, it is important to plan ahead to avoid issues with eligibility requirements for Medicaid.
The first eligibility requirement is that someone has to pass a means test, when looking at their income and asset levels. For instance, a single person currently needs to have under $9,950 in assets in Michigan, and their income can not exceed $2,982 per month.
The second eligibility requirement is medical. It must be demonstrated that the person genuinely needs the level of care provided in a nursing home in order for them to qualify for benefits. Both financial records and medical records will be necessary.
Michigan Medicaid FAQs
At our Kalamazoo law firm, we have more than three decades of experience guiding clients through the intricacies of Medicaid planning. Some of the questions we hear most often include the following:
What is Medicaid and how do I know if I’m eligible for it?
Medicaid is a state and federally funded program providing medical coverage to eligible seniors who need long-term care. The program is strictly “need-based,” so seniors must submit to a review of their income and assets to learn if they qualify. Because the rules regarding financial eligibility are complicated, it is important not to assume that you do not meet or cannot meet the eligibility requirements.
When should I begin Medicaid planning?
You should begin Medicaid planning at least five years before you anticipate needing long-term care. This is because Michigan, like many states, has a “5-year look-back” policy. This means that when you apply for Medicaid, the state will review your financial transactions from the past five years. Any significant transfers or gifts made during this period may result in a penalty period, delaying your eligibility for benefits.
What decisions do I have to make regarding Medicaid?
Decisions regarding Medicaid often include understanding coverage options, choosing health care providers that accept Medicaid, managing income and assets to meet eligibility requirements and possibly considering long-term care options and insurance.
How do I apply for Medicaid?
In Michigan, you can apply for Medicaid through the Michigan Department of Health and Human Services (MDHHS) online via the MI Bridges portal, by phone, by mail or in person at your local MDHHS office. Our DeMent & Marquardt, PLC, attorneys can provide personalized guidance through the Medicaid application process and help you understand the specific requirements.
What kinds of mistakes do people make regarding Medicaid?
Common mistakes that people make include underestimating and overestimating income limits, failing to plan for long-term care needs, not understanding eligibility rules specific to Michigan and not seeking professional guidance early in the planning process. These oversights can result in delayed benefits, eligibility issues or missed opportunities to protect assets.
Early Preparation Is Crucial
Medicaid planning involves numerous considerations. You may need to leverage estate planning tools, like trusts and strategic titling of real estate, to qualify for Medicaid without losing everything you have worked so hard to build. It is never too soon to start planning. Contact us for strategic guidance. You can also reach us by phone at 269-343-2106.