The trustee of a Medicaid Asset Protection Trust (MAPT) is responsible for managing and overseeing the trust to safeguard the assets for the beneficiaries while following the wishes and intentions of the grantor. This includes making sound financial decisions, distributing assets as stipulated by the trust, and ensuring compliance with all legal and administrative requirements.
What Is the Medicaid Asset Protection Trust?
A Medicaid Asset Protection Trust is a legal arrangement designed to protect assets from being counted toward Medicaid eligibility. This trust allows individuals to qualify for Medicaid long-term care benefits while safeguarding their assets.
A MAPT is particularly beneficial for individuals who would not otherwise be eligible for Medicaid coverage. This is because assets placed in this trust are no longer considered owned by the Medicaid applicant, allowing them to meet the eligibility requirements for Medicaid.
In addition to safeguarding assets for the Medicaid applicant, a MAPT also ensures that assets are protected for their children and other relatives, making it an effective strategy for both Medicaid applicants and their families.
Key Players in a Medicaid Asset Protection Trust
The MAPT involves key individuals, including the grantor, who establishes the trust, and the trustee, who assumes responsibility for managing the trust’s assets and ensuring the trust’s rules are followed. However, it should be noted that the trustee cannot be the maker of the trust or their significant other. In addition, a beneficiary will be selected to receive benefits from the trust once the grantor passes away. This stipulation ensures conformity with Medicaid rules and regulations.
Qualifying for Medicaid Asset Protection Trust
To become eligible for Medicaid, individuals must ensure their household assets fall below a specific threshold. The regulations relating to asset levels are quite stringent, and there is a prescribed five-year lookback period in place to assess an individual’s eligibility. However, if a MAPT is established and assets are transferred at least five years before the donor applies for Medicaid long-term care benefits, the individual will not face penalties for asset transfers, and the trust will not hurt their Medicaid eligibility.
The Advantageous of a Medicaid Asset Protection Trust
Placing assets in a Medicaid Asset Protection Trust offers significant advantages. It enables individuals to meet Medicaid’s asset limit without depleting their assets, providing a crucial way to safeguard their wealth. Additionally, assets held in a MAPT can be protected for the benefit of specific beneficiaries designated by the trustee, ensuring that intended recipients can benefit from these resources. Finally, establishing a MAPT safeguards these assets from Medicaid Estate Recovery, making it a critical consideration for long-term planning.
Medicaid Estate Recovery is a process where the state attempts to recoup the expenses incurred for an individual’s long-term care upon their passing. Typically, the state seeks reimbursement by making claims on the deceased individual’s estate. However, assets held within a Medicaid Asset Protection Trust are shielded from such claims, offering a secure method of preserving resources for the designated beneficiaries. This arrangement ensures that the state cannot access the assets held within the trust, providing peace of mind and asset protection for individuals and their families.
Contact Losavio & DeJean Today To Learn More About Using a Medicaid Asset Protection Trust
Medicaid is a government program that provides health insurance benefits to over 72 million Americans. However, many people overlook the importance of planning for Medicaid as part of their estate plan. At Losavio & DeJean, LLC, The Louisiana Elder Law Firm, our experienced Medicaid attorneys are here for you, ready to help you determine Medicaid eligibility and assist you with applying.
For further information, contact Losavio & DeJean today to learn more.