What is “half a loaf”? And why not keep the “whole loaf”?
First off, “half a loaf” is a nursing home Medicaid spend down strategy where approximately half a person’s money can be saved. The basic idea is that half of the applicant’s money is “divested” or given away. The other half purchases a “Medicaid annuity” to provide payment to the nursing home while Medicaid will not. For example let’s say Mrs. Smith has sold her home and has $150,000 in the bank. She is in a long term care nursing home. If she does nothing she will spend all $150,000 on nursing home bills. If she gives half of it to her children and purchases a Medicaid annuity with the other half, she will have saved half of her money.
Now let’s be clear, this post is not all about the moving parts of the “half a loaf” strategy. There are many. This post is about raising the question “Can I do better than the “half a loaf”? The short answer is “Yes, much better.”
It puzzles me why so many “elder law” attorneys use the strategy as their main approach to Medicaid eligibility. Under their strategy the nursing home will be paid by the applicant for months and sometimes years!
The problem I have with that is that my clients are hard-working folk who saved instead of squandering the money they earned. They paid taxes on it too. At age 90 many have been taxpayers for more than 70 years! They have a right to say what are the provisions in the Medicaid program that will allow me to have the taxes I paid all these years pay the nursing home? We all know President Trump brags about paying little or no taxes because he has “smart lawyers.” Why shouldn’t you have a “smart lawyer?”
Here’s my point. In the Mrs. Smith example above we could help her save the “whole loaf” (minus modest attorney fees).
So if you know anybody who has seen an “elder law attorney” who recommends a “half a loaf” strategy, give us a call for a consultation to see if you cannot do much, much better.
