Frequently Asked Questions

Frequently, grandparents contribute generously towards 529 Plans for their grandchildren.  What many of our clients do not realize is that should a time come that an application for Medicaid becomes necessary, those accounts are considered to be the assets of the custodian of the account, oftentimes the Medicaid applicant. 

Another issue that arises with 529 plans and Medicaid planning are the payments made from those plans.  Assuming the time has come to use the funds to pay for the beneficiary’s education, payments made from those accounts in the five years prior to the Medicaid application will be considered transfers when an application for Medicaid is made.

Community Medicaid is the program that covers care at home. It covers the cost of a personal care aide to assist with activities of daily living such as bathing, cooking, dressing, day programs, transportation to medical appointments, assisted living programs, and some medical equipment and supplies. 

The Chronic Medicaid program covers nursing home care. The resource eligibility level is the same as the Community Medicaid program; that is $28,133.00. However, any income over $50 must be paid to the nursing home facility. If the applicant has a spouse, the spouse can keep up to $3,715.50 in total income.

Frequently, grandparents make substantial contributions to 529 Plans on behalf of their grandchildren. What often escapes notice is that in the event Medicaid application becomes a requirement, these accounts are classified as assets belonging to the custodian, who is typically the Medicaid applicant. Another concern linked to 529 plans and Medicaid strategizing is the disbursement of funds from these plans. If the occasion arises to utilize the funds for the beneficiary's educational expenses, disbursements made from these accounts within the five-year period preceding the Medicaid application could potentially be categorized as transfers during the Medicaid application process.

No, while some attorneys prepare a single document that includes both a Health Care Proxy and a Living Will, these two directives serve very different purposes. 

A Living Will is an advance directive that sets forth your wishes for refusing or accepting end-of-life medical treatment in the event you can no longer communicate your wishes directly. 

A Health Care Proxy allows you to designate an agent to make health care decisions for you in the event you are unable to make them for yourself.