Medicaid can be extremely helpful for covering your nursing home costs. But getting coverage to pay for your long-term care is not always simple. It can be difficult to understand the rules, especially with a lot of misinformation out there about the program.

Knowing the truth about Medicaid is crucial to obtaining the benefits you need. Three common myths about Medicaid eligibility are busted below.

Myth 1: You have to give up everything to qualify

You may believe you need to become totally destitute to become eligible for Medicaid. The truth is, you do not need to give everything away. What is true is that if you own a significant amount of assets, you may need to “spend-down” a little bit.

However, some assets are exempt, meaning they do not count against your eligibility. These include vehicles, personal items and certain life insurance plans, as just some examples. 

Myth 2: It only covers sub-par medical care

Another common Medicaid myth is that you will need to settle for a sub-par nursing home. This is not true. Medicaid pays for the same nursing homes for which others pay out-of-pocket. Medicaid is just another form of insurance, and you can go to the same nursing home you would have if you were covered by private long-term care insurance.   

Myth 3: You should hide/gift your assets

It can be tempting to give away your assets to loved ones in order to qualify for Medicaid. The truth is, it is entirely possible to qualify for Medicaid by being transparent and legal. The government will examine your finances and see if you have given significant assets away in the last five years. If you are not careful about spending and gifting during the “look-back” period, you may incur costly penalties.

An elder-care lawyer can help you spend-down your assets strategically in adherence to Medicaid rules, so that you qualify without incurring penalties.

For more help understanding your Medicaid eligibility, you should talk to an elder-law attorney.