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Barrister
Barrister, Lawyer
Category: Family Law
Satisfied Customers: 33784
Experience:  Attorney with 15 years experience
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I am in New York, Ulster county. If I get an insurance

Customer Question

I am in New York, Ulster county. If I get an insurance financial settlement due to a car accident, do I have to report it to medicaid? If I do, will I lose my medicaid benefits. Is it considered income? Can I put the money in a living trust? Or, pay it to my caretaker for years of care? I am handicapped and require 24 hour care. Medicaid pays for adult care, but
I have a private caretaker who cares for me for free during the night. I would like to pay him with my insurance settlement, if I get any, which I am 100% sure I will get, if I sue.
Submitted: 1 year ago.
Category: Family Law
Expert:  Barrister replied 1 year ago.

Hello and welcome! My name is ***** ***** I will try my level best to help with your situation or get you to someone who can.

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If I get an insurance financial settlement due to a car accident, do I have to report it to medicaid?

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Yes, you must report any settlement you receive to your caseworker within 10 days of receiving the funds.

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If I do, will I lose my medicaid benefits. Is it considered income?

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Yes, since Medicaid is a poverty based program, if you have substantial assets, you wouldn't qualify and you would have to spend down the settlement paying for your own care until you qualified for Medicaid again. It is not income, but is a "countable resource".

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Can I put the money in a living trust? Or, pay it to my caretaker for years of care?

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You could have an estate planning attorney set up a "Special Needs Trust". If the trust is properly established and administered, the injured plaintiff can continue to remain eligible for public benefits, such as SSI and Medicaid, and benefit from the use of the personal injury settlement. If you irrevocably fund the trust through a structured settlement, your payments are completely exempt from all federal and state income taxes. This gives you a guaranteed source of funds in addition to Medicaid, while still allowing you to remain eligible for SSI. A 2009 New York Times article called special needs trusts “a common and effective way” to supplement government benefits.

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So it would be a good idea to talk to a local estate planning attorney about setting up the special needs trust so you don't get disqualified for Medicaid and may be able to pay your caregiver from the trust.

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If you feel your original question and any related follow ups have been answered, I would very much appreciate a positive rating on the answer I have provided so I receive credit for my work. If you have a new question the JustAnswer folks require that you start a new question page, but you can request me by putting "For Barrister" in the caption and they will get it to me.

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thanks

Barrister