personal injury settlement

by tom
(raleigh, nc)

my dad (92) was in a car accident. he is to receive a lump sum settlement. how or will this lump sum affect his medicare and medicaid.

Comments for personal injury settlement

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Oct 05, 2015
Different answer for Medicare vs Medicaid
by: Gabriel Heiser (Author of Medicaid Secrets)

Since Medicare is not a means-tested program, it will not affect his Medicare. It is possible that part of the settlement will have to be used to reimburse Medicare, to the extent it relates to coverage for medical costs.

As for Medicaid, the lump sum award will be treated as income in the month received, and anything remaining at the end of the month will be treated as an asset. Thus, to avoid having the recipient disqualified from Medicaid following receipt of the award, he should contact an elder law attorney immediately to plan how to minimize the effect of the receipt. For example, part of the award can be used to fix up his house or part can be used to purchase a so-called "Medicaid annuity." There are many techniques available to conserve the money and minimize the amount of time he will be disqualified from Medicaid.

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