'Medicaid Planning' Is the Wrong Call

QMy sister says our family should begin elaborate "Medicaid planning" to shelter our elderly parents' assets and make them look poor enough to qualify for government-paid nursing-home assistance, even though they're in good health today. I think this is unethical. What do you think?

AI'm with you, and I wonder about your sister's motive (does she want to make sure that she gets her inheritance early?). People who can afford to buy long-term-care insurance in their early senior years -- say, in their 50s to mid-60s -- should do so instead of resorting to Medicaid subterfuges later in life.

Medicaid -- a state and federal health-care program that's financially strapped -- was intended for the poor. It was not meant to relieve better-off families of their responsibility for taking care of older family members.

A number of states, including California and New York, offer so-called "partnership LTC insurance," which allows you to qualify for Medicaid if your LTC coverage runs out, but without exhausting all of your assets.

Ethics aside, a change in the rules several years ago makes it much harder to qualify for Medicaid by coming up with creative ways to divest your assets. I think that's a good thing.