I have concentrated my practice in the area of elder law for almost twenty years now.  In that time, I have represented hundreds upon hundreds of clients in qualifying for Medicaid benefits.  In the vast majority of the cases, the client has obtained Medicaid benefits.

With that said, I always tell clients that I treat every application for Medicaid I handle as if it is the first application I have ever handled. Being ever vigilant is the best way to approach a Medicaid application.

As those of you who read my column know, Medicaid is a federal and state health payment plan for needy individuals. In order to qualify for Medicaid, an applicant must have very limited assets and insufficient income with which to pay for her care.

When I assist a client in applying for Medicaid benefits, I prepare the application for the client. I file the application, and I handle all communications with the Medicaid office.  An application for Medicaid benefits takes several months to be approved, though, under law, the Medicaid office must process an application for benefits within forty-five days.

Medicaid is a very complex law. I know most every elder law attorney in New Jersey, and we elder law attorneys speak quite regularly, asking each other questions and offering our advice to one another.  My colleagues are very intelligent attorneys who, like me, have been practicing elder law for decades.  Yet—despite being attorneys, despite practicing one area of the law—we still have questions about elder law, and in particular Medicaid.

When a client hires me to assist them with applying for Medicaid, they inevitably will need me to advise them on what to do in order to qualify for Medicaid. For instance, a very common Medicaid “spend down” technique is to purchase a prepaid funeral.  Since everyone dies and will eventually need a funeral of some nature, I often advise clients to purchase a prepaid funeral.

This advice is legal advice. As simple as it sounds, telling a client to purchase a funeral and that the purchase of the funeral will assist the client in qualifying for Medicaid benefits is legal advice because I am interpreting the law and advising the client what to do given the law.

Only a lawyer can provide legal advice. In fact, several years ago, the Supreme Court of New Jersey issued an ethics opinion that specifically held providing such advice is legal advice, so if a person who is not an attorney provides such advice, that person is committing a criminal act known as the unauthorized practice of law.

In the past several years, a number of companies have sprung up that assist people with applying for Medicaid benefits. A non-attorney could assist someone in applying for Medicaid and could charge a fee for that service; however, the non-attorney cannot provide any legal advice—even a simple piece of advice such as “purchase a prepaid funeral”—on how to qualify for Medicaid.

I mention this because many families are advised by the nursing home to hire these non-attorney Medicaid application companies. These companies charge about $6,500 for their services, which is actually more than I charge.  These companies often are very closely aligned with the nursing homes.  In fact, the application company is so closely aligned with the nursing home that it would be difficult to tell who the “client” is—the person who paid them the $6,500 or the nursing home that referred the family to them.  In my opinion, the application company is far more tied to the nursing home than to the individual applicant because the nursing home is continually making referrals to them.

I also find it ironic that in order to effectively represent the applicant, the application company must commit a crime by providing legal advice. In my opinion, based upon applying hundreds of times, it is impossible to represent someone in applying for Medicaid without providing legal advice.  My advice is, don’t pay more for less.  Hire an attorney to assist you with your application for Medicaid.

Understanding what you are paying for can help avoid unnecessary expenses. A thoughtful approach can lead to better outcomes without overspending.