There are a wide range of different roles that trusts can play in a person's estate plan. One of the more well-known roles they can have is that they are one of the ways a person can control what happens to their assets when they pass away. Today, however, we will go into one of the other estate planning functions they can serve: being a part of a person's planning for potential future long-term care.
Making preparations in one's estate plan to address the possibility of needing long-term care in one's elder years can be very important. One reason for this is the rather large costs that can go along with long-term care. Without proper planning, such costs can catch a person and their family quite off-guard financially.
One potential source for covering such costs is Medicaid benefits. An important thing to note though about this government benefits program is that there are some very strict eligibility rules that a person needs to meet in order to be able to receive benefits. Among these rules are limits on how much in the way of income and assets a person can have.
There are certain things that may be able to make it so certain assets will not be counted towards a person's asset total when it comes to Medicaid eligibility. Thus, Medicaid planning can sometimes be a very important part of long-term care planning. There are several different ways through which a person may be able to protect assets while still preserving their eligibility for Medicaid benefits. One of these is through using trusts.
When using trusts as part of Medicaid planning, it can be incredibly important to have the trusts contain the proper terms. When a Medicaid-planning-related trust is set up improperly, it could delay or compromise a person's Medicaid eligibility. Experienced long-term care planning attorneys can help individuals determine if Medicaid-planning-related trusts are something they should consider having as part of their long-term care planning and help them with the process of getting such trusts properly set up.