Growing the Understanding of the Effects of Medicaid and Five Year Look Back on Family Farm Assets

Commodities

Practices

• Education and Training: decision support system, technical assistance
• Farm Business Management: business planning, farm succession, risk management

Project Focus: Pennsylvania Farm Link is a 501c3 non-profit organization dedicated to ensuring farms successfully move forward to the next generation of farmers. PA Farm Link has brought topics such as Medicaid and the five year look back to the forefront educating ag professionals and farmers of the risk and potential impact to the security and sustainability of the family farm.

Farmers often lack savings to pay for long term care needs and when care is required, savings is quickly depleted as 2024 Pennsylvania median annual long-term care costs for at home care is $71,878, assisted living $68,598 and private nursing home room $142,861. (Genworth Financial, Inc.)

Proper planning is required to minimize the impact of long-term care costs on farm assets and farmland.

Once a person’s funds are spent down Medicaid will pay for care, however, a lien will be placed on assets the person owns to recover the care costs. This includes assets gifted or sold at discounted value within five years of requiring care.

Ag professionals and farmers require increased understanding and education of Medicaid in order to minimize the risk to the family farm assets.

Solution and Approach: Educating ag professionals and farmers on the topic is top priority, understanding how Medicaid works is the first step. However, more needs done.

Growing the Understanding of the Effects of Medicaid and Five Year Look Back on Family Farm Assets will empower ag professionals and farmers to estimate the potential financial impact to the family farm. An online calculator will be developed allowing ag professionals to assist farmers in determining the potential financial impact to farm assets. The calculator will also provide an option to determine likely care costs for the family member. This is the first tool of its kind to be developed for the agriculture community and can be adapted for use beyond Pennsylvania.

Small group training activities will ensure ag professionals are confident using the calculator while working with farmers.  Ag professionals will work with farmers during succession planning workshops to demonstrate the value of the electronic calculator in determining the potential the risk to the farm.

The second largest farmer request and need will be addressed with a booklet developed providing steps to obtaining long term care. It will answer the questions: What steps to take when you know someone is declining? How are you going to pay for it? How to you prepare for that? What if someone requires care due to a sudden disability such as stroke or accident?

The booklet will provide answers and walk farm families through the process, lessening stress as they have a guide to follow when care is required.

60 ag professionals will utilize Medicaid knowledge and calculator to determine possible farm financial impact and educate farmers about the potential effect of Medicaid on farm assets.

100 farmers will take steps to minimize risk of Medicaid to the farm as a result.

32 farmers will seek to calculate potential financial impact of Medicaid to their farm.