[This article was originally published on April 21, 2005. The links were updated on July 23, 2018.]
Last month we asked site visitors and readers of the April issue of ElderLaw News the following question:
"Medicaid planning has been targeted by Health and Human Services Secretary Michael O. Leavitt, who argues that people should not be able to protect assets by transferring them to their children and then qualify for Medicaid coverage of nursing home care. Do you believe that such Medicaid planning is ethical?"
The results: nearly two-thirds of respondents -- 63 percent -- said yes, Medicaid planning is ethical, while the rest -- 37 percent -- said it was unethical.
With Medicaid budgets soaring nationwide, state and federal officials are floating proposals to crack down on the financial arrangements involved in Medicaid planning and make seniors pay more for long-term care, according to a recent article in the Chicago Tribune, "Medicaid Loophole for Middle Class at Risk."
Connecticut, Massachusetts, Minnesota and New Hampshire have proposed making it more difficult for the elderly to transfer assets and qualify for Medicaid, and more than a dozen states have similar plans waiting in the wings, says Charles Sabatino, chair of the public policy committee for the National Academy of Elder Law Attorneys.
But advocates for the elderly respond that Medicaid has become a crucial safety net for ill seniors who need long-term care, and weakening protections would be a severe blow to many families.
Illinois elder law attorney Steven C. Perlis is quoted in the article as saying that most middle-class seniors who turn to Medicaid for nursing home care are "people who are up against the wall because of a serious illness, who have never depended on a government handout in their lives."
Any asset transfers are usually minimal, Perlis says, and represent an attempt to give resources to a healthy spouse who needs the money, or to leave something to children who provided care and assistance before a parent was institutionalized.
To read the full Chicago Tribune article, click here. (Free registration may be required to view article.)