Do you or a loved one need long-term care? Long-term care is necessary for many seniors who can't live independently fully. Unfortunately, long-term care can be costly and usually not covered by Medicare. If you or your loved one must pay for out-of-pocket long-term care, you could completely deplete your assets. Medicaid does cover long-term care, but not everyone qualifies for Medicaid. Medicaid is meant for those who have financial need. There are limits on assets and income to qualify for Medicaid. If you have significant assets or income, you may not be eligible. Fortunately, there are steps you can take to shield assets and income from Medicaid so you can qualify for coverage. Below are a few steps to discuss with a Medicaid planning attorney.

Use a trust. You can transfer assets into a trust and remove them from your estate. The trust becomes the owner of the assets, and you give up control of them to the trust. Keep in mind this doesn't mean you lose those assets. They are held in the trust until you pass away, at which point they are distributed to your heirs. You can still benefit from the trusts. In fact, you can transfer your house into the trust but continue to live in it. Trusts can be complex and require detailed legal work. You should work with an experienced Medicaid planning lawyer to create your trust.

Give assets to family. You can also give assets to family members so they won't count against your Medicaid eligibility. It's important to be careful with this strategy, though. Medicaid has an eligibility look-back period. That means Medicaid will look back several years to see if you have transferred assets to others. If so, your eligibility could be denied or delayed. If you're going to gift assets to others, you should start well before you actually need Medicaid. You'll also want to structure the transfers in a way that doesn't trigger gift taxes and other penalties for you or your loved ones. A Medicaid planning attorney can help you implement a gift strategy.

Use a Medicaid annuity. Some states allow the use of Medicaid "annuities." These are specific annuity products in which you can deposit assets. The annuity then pays you a level of income for some of your long-term care. The annuity is non-revocable, which means you cannot regain the assets. When you pass away, the assets are distributed to your heirs. However, while you are alive, the annuity is not considered part of your assets. That can help you qualify for Medicaid for long-term care coverage.

For more information, contact a Medicaid planning attorney near you.