After working and saving throughout your life, you may feel some reluctance to exhaust your funds on a few months of long-term care. However, as long as your nonexempt income and assets are above the limit, Medicaid will not cover your nursing home costs.
According to the American Council on Aging, Florida offers a couple of options for lowering your income or placing “excess” income into a trust. Because of the five-year look-back period, you need to take care of matters now, before you are ready for long-term care.
Spending down income and assets
Some assets and income count toward the limit, and some do not. You may be able to spend your countable income and assets on those that are exempt. For example, you cannot sink your extra income and assets into major home renovations. However, you can spend them on modifications such as a ramp or lift.
You can also pay in advance for your funeral expenses and burial costs, which would likely have come out of your estate after your death, anyway. As a bonus, this makes things easier for your family members later.
Qualified Income Trusts
You may set up a QIT and arrange to deposit some of your income into it monthly so that what remains is below the limit. The arrangement is irrevocable, which means once you set it up, you do not have the authority to change it.
Also, a trustee manages the funds according to the trust requirements, which are strict. For example, your trustee may give you a personal needs allowance or pay medical bills or Medicare premiums. When you die, the remainder of the trust goes back to the state.