Long Island Medicaid planning attorney Seth Schlessel (https://www.schlessellaw.com/disadvantages-of-a-medicaid-trust/) of Schlessel Law, PLLC, recently provided insights into the disadvantages of setting up a Medicaid trust. In a detailed article, Schlessel addresses critical issues that individuals should consider before establishing such a trust, particularly those aimed at safeguarding assets while still qualifying for Medicaid benefits.
Seth Schlessel, a seasoned Long Island Medicaid planning attorney, begins by highlighting the primary purpose of a Medicaid trust: to protect assets from being counted as part of an individual’s estate, thereby enabling Medicaid eligibility for long-term care. However, he stresses that while a Medicaid trust can be an effective tool in certain situations, it also comes with significant drawbacks that must be carefully weighed.
According to the Long Island Medicaid planning attorney, one of the most prominent disadvantages is the irrevocability of a Medicaid trust. Seth Schlessel explains that once assets are placed into this type of trust, they are essentially out of the grantor’s control. “The assets in a Medicaid trust are no longer accessible to the person who created the trust,” Schlessel states, underscoring the importance of fully understanding this loss of control before proceeding with such an arrangement.
Another key concern that Schlessel raises is the potential impact on future financial needs. The Long Island Medicaid planning attorney warns that individuals who might require access to their assets for unforeseen expenses will find themselves in a difficult position if those assets are locked away in an irrevocable Medicaid trust. This aspect can be particularly challenging for individuals who do not have other significant sources of liquid assets or income.
Seth Schlessel also points out the timing issues associated with Medicaid trusts. He notes that there is a five-year look-back period, during which any transfers into a Medicaid trust can affect eligibility for Medicaid benefits. The Long Island Medicaid planning attorney advises that this means careful planning is essential, as improper timing can result in penalties and delays in receiving necessary care.
In addition to these considerations, Schlessel highlights the potential for family disputes that may arise from Medicaid trusts. The irrevocable nature of these trusts can sometimes lead to disagreements among beneficiaries, particularly if the grantor’s intentions are not clearly communicated. According to Schlessel, such disputes can cause strain on family relationships and potentially lead to costly legal battles.
Schlessel’s article serves as a critical reminder that while Medicaid trusts can be beneficial in certain circumstances, they are not without significant disadvantages. He advises individuals considering a Medicaid trust to consult with a knowledgeable Long Island Medicaid planning attorney to fully understand the implications and further ensure that the trust aligns with their overall estate planning goals.
For those navigating Medicaid planning, Seth Schlessel’s insights provide a valuable perspective on the importance of careful consideration and professional guidance. Establishing a Medicaid trust is a decision that should not be taken lightly, and understanding the potential drawbacks is essential to making an informed choice.
Individuals interested in learning more about Medicaid planning and the potential disadvantages of Medicaid trusts are encouraged to reach out to Seth Schlessel at Schlessel Law, PLLC. His article emphasizes the importance of being well-informed and considering all aspects of asset protection before proceeding with a Medicaid trust.
Schlessel Law, PLLC, can offer comprehensive legal services to the Long Island community, helping clients navigate the often-complicated process of Medicaid planning. Seth Schlessel’s extensive experience and commitment to client education can make him a trusted resource for those seeking to protect their assets while ensuring access to necessary long-term care.
About Schlessel Law, PLLC:
Schlessel Law, PLLC, based on Long Island, New York, can provide legal services focused on Medicaid planning, estate planning, elder law, and asset protection. Led by Seth Schlessel, the firm is dedicated to helping clients address complex legal issues with clarity and confidence. Schlessel Law, PLLC, is committed to offering personalized guidance and practical solutions to meet each client’s unique needs.
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