With costs of long-term care, assisted living facilities, and nursing homes constantly increasing, more people have turned to government programs like Medicaid to afford the cost of care. However, Medicaid has strict financial eligibility rules that many people cannot meet—even those who cannot afford the care they need without government assistance. Medicaid planning provides a way for Lansing residents to access benefits while preserving family wealth for future generations.
Medicaid Eligibility Basics in Michigan
The Medicaid program in Michigan places limits on the income and countable assets that an individual or couple applying for benefits can have. As of 2026, an applicant must have less than $9,950 in countable assets and a monthly income lower than $2,982. “Countable” assets include bank accounts, assets, and second properties, but not an applicant’s primary residence (up to an equity limit), their household goods and personal items, one household vehicle, and burial funds.
Common Medicaid Planning Strategies in Lansing
Some of the most common Medicaid planning strategies that individuals and couples may use to qualify for benefits in Lansing include:
- Spend-down strategies: Medicaid rules allow applicants to spend assets on various allowable expenses. These include home improvements, home modifications to install accommodations, the purchase of a modified vehicle or changes to an existing vehicle, certain medical and dental expenses, prepaid funeral and burial expenses, and paying off personal debts or mortgages.
- Medicaid asset protection trusts: Placing assets in a qualifying Medicaid asset protection trust (MAPT) can remove those assets from the applicant’s estate after five years following the transfer. MAPTs may permit distributions to a spouse who does not receive Medicaid benefits. MAPTs can also preserve assets for loved ones.
- Medicaid-compliant annuities: Applicants can also purchase annuities that meet Medicaid rules, thereby converting countable assets into a potentially exempt income stream
Medicaid planning strategies must follow the program’s complex rules, including the five-year lookback rule, which can impose penalties on certain non-qualifying transfers of assets made in the five years before applying for Medicaid. Penalties can delay an individual’s receipt of Medicaid benefits, potentially requiring them to pay for long-term care out of pocket temporarily.
Medicaid Planning for Married Couples
Medicaid rules can also provide financial advantages when a person applies while married to a spouse who does not require long-term care (called a “community spouse”). The rules allowed married couples to exempt additional assets and income from counting toward an applicant spouse’s limits, ensuring that a community spouse has the financial resources they need to support themselves.
Why Early Planning Matters
Given the five-year lookback rule, it’s important to begin Medicaid planning as early as possible, as this will keep your options open to you. By planning years in advance of when you expect to need Medicaid benefits, you can develop a comprehensive legal and financial strategy that maximizes protection of your wealth while ensuring that you qualify for benefits. However, individuals who unexpectedly need long-term care may still have options in “Medicaid crisis planning” – Medicaid planning that occurs in the context of an applicant’s unexpected medical emergency and sudden need for Medicaid benefits to afford long-term care.
Contact Our Firm Today for Experienced Advice and Support
Do you anticipate that you or a loved one will need long-term care in the Lansing, Michigan, area? If so, Medicaid benefits may be available to help you and your family cover the cost. However, qualifying for Medicaid requires meeting strict financial eligibility criteria, so you may need legal and financial planning to ensure your eligibility. Contact Leydorf Law Firm, PLLC today for a confidential consultation with an estate planning attorney to learn more about the process of Medicaid planning in East Lansing.