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Repairing a Denied Medicaid Application

It happens all too often. A family reaches the point where they are no longer able to care for an aging parent. They begin the process of applying for Medicaid so the parent can receive long-term care only to have the application denied due to some previously unknown income or asset. Now the family does not know what their next step should be because the parent really does not have the money to pay for long-term care but still does not qualify for Medicaid.

Fortunately, there are several things you can do to correct a denied Medicaid application or to avoid a denial in the first place. Most Medicaid denials come about because the elderly parent either has too much monthly income or too many nonexempt assets. Problems with transfers made during the lookback period are also common. However, most of these issues can be corrected:

  • A properly drafted trust can be used to legally take surplus income out of the Medicaid equation in some circumstances.
  • An actuarially sound qualifying annuity can be useful for converting assets to income or providing an income stream for a spouse who still lives in the community.
  • Converting countable assets like cash into noncountable assets like a personal vehicle or residence can be especially helpful when both spouses are living but only one is seeking Medicaid.

Gifts made during the infamous five-year Medicaid lookback period can be a bigger problem. In some cases, an attorney may be able to successfully argue that such a transfer falls within one of the several exceptions in the Medicaid law. If all else fails, the party who received the gift can still return it to the applicant so that it can be used to pay for long-term care expenses. Whatever the case may be, a Florida Medicaid planning attorney can give you the knowledge necessary to perfect a faulty application or to address ineligibilities before filing.

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