In New York, as well as other states, paying for care in old age is an intimidating prospect. One of the challenges is finding out how to qualify for Medicaid. Medicaid can help pay for a lot of care, but you can qualify only if you have few assets and are living on a low income.
Medicaid Asset Protection Trusts
A Medicaid asset protection trust, or MAPT, is a legal and financial tool that can help separate away some assets that you own. If you place them in the right kind of trust, then they will not count against the Medicaid eligibility threshold. They are no longer legally your property. This allows a person to qualify for Medicaid without losing control of major assets like their house. Without a trust, you would have to sell those assets and pay the money to Medicaid.
Setting up an MAPT is not simple. The wrong kind of trust will lead to penalties and other consequences that could make the process for qualifying for Medicaid harder, not easier. Having a good MAPT is key for retaining control of hard-won assets that have been saved up over many years, and keeps them available for younger generations. Except for the most wealthy, care for older adults can be ruinously expensive, and Medicaid is one of the only options for an insurance policy that will provide consistent coverage.
Creating an MAPT might be one of the best ways to prepare for aging and for managing the changing costs of life. It can preserve wealth and also provide the safety and reassurance of a plan that can support the aging process.