The most pressing elder law issue that we address is the matter of long-term care. Nursing homes and in-home caregivers are very expensive, and Medicare does not cover the custodial care they provide.
Fortunately, there is a solution in the form of Medicaid eligibility. This program will cover custodial care, but it is a need-based benefit, so it takes careful planning to qualify.
Understanding the potential impact of Medicaid estate recovery is equally important, as it can affect what assets remain for your family after you are gone.
Medicare Limitations
Medicare provides important health coverage for seniors, but it has strict limits when it comes to long-term care. While Medicare pays for skilled nursing care under specific circumstances, it does not cover ongoing custodial care.
For example, if you need rehabilitation after a hospital stay, Medicare may pay a limited amount of days in a skilled nursing facility. After that, you are responsible for a daily coinsurance payment. Once you reach the coverage limit, Medicare stops paying entirely.
If you need help with activities of daily living, such as dressing, bathing, or eating, Medicare does not pay for this assistance over the long term. These services are considered custodial care, and they are the type of help most seniors require as they age.
Because of these limits, many families are surprised to learn that they must turn to Medicaid to cover nursing home costs.
Medicaid Eligibility
Medicaid can cover nursing home care and other long-term care services, but you must meet strict financial guidelines. In Oklahoma, you are subject to strict asset limit in countable resources if you apply as a single person.
However, not everything you own counts against this limit. Some of the most common non-countable assets include:
- Personal belongings and household items
- One vehicle of any value
- Burial plots
- Irrevocable burial trusts up to an allowable amount
- Term life insurance policies with no cash value
Even with these exemptions, most seniors own more than the allowable amount in countable assets, so they must plan carefully to become eligible without losing everything.
Home Ownership
Your home is treated differently under Medicaid rules. In Oklahoma, your primary residence is considered a non-countable asset if your equity interest does not exceed a certain limit. This equity limit is adjusted periodically, so confirming the current threshold with an Oklahoma elder law attorney is an important step in the planning process.
This means that if you live alone and your home equity is below that amount, the property does not count toward the asset limit.
If a spouse, dependent child, or disabled relative resides in the home, there is no equity limit at all. In these cases, your home is fully exempt while you are alive.
Many people feel relief when they learn this rule. However, this protection only applies during your lifetime, not after your death.
Medicaid Estate Recovery
After you pass away, the state has the right to seek reimbursement for the cost of care paid by Medicaid. This process is known as Medicaid estate recovery.
If you own a home when you die, Oklahoma Medicaid can file a claim against your estate. The state may place a lien on the property, which can force your heirs to sell it to repay the Medicaid expenses.
This reality surprises many families. Even though you qualified for Medicaid as a homeowner, your house can still be at risk once you are gone.
There are limited protections against estate recovery. For example, the state cannot force a sale if a surviving spouse, minor child, or disabled child lives in the home. Once those individuals no longer live there, the state can move forward with recovery.
Irrevocable, Income-Only Medicaid Trust
If you want to protect your home and other assets, you have options. One of the most effective strategies is creating an irrevocable, income-only Medicaid trust.
When you place your home into this type of trust, you give up the right to sell or use the principal. However, you can continue to live in the home for the rest of your life, and you may receive income from the trust’s earnings.
To be effective, you must fund the trust at least five years before applying for Medicaid. This is because of the five-year look-back period, which prevents last-minute transfers to qualify for benefits.
Once the five-year window has passed, the home is no longer considered part of your countable estate. As a result, Medicaid cannot place a lien on the property when you pass away. Your heirs can receive the home without the burden of estate recovery.
Let’s Get Started!
We can help you preserve your legacy in light of potential long-term care expenses. To get started, call our Oklahoma City elder law office at 405-843-6100. Our Tulsa location can be reached at 918-615-2700, and you can use our contact form to send us a message.
Since founding Parman & Easterday in 1985, Larry has led over 1,000 free, community-service education programs and helped more than 10,000 Oklahoma families go from putting off their estate plan to getting it done. His goal for every client is the same: to become the person their family calls "the one who took care of everything."
Larry is the author of three books: The Straight Shooter's Guide to Estate Planning; Estate Planning Basics; and Guiding Those Left Behind in Oklahoma. He served as Oklahoma's Secretary of State and Secretary of Commerce, and his firm is the only member of the American Academy of Estate Planning Attorneys in the state.
- Choosing the Right Successor Trustee: Key Considerations - October 8, 2026
- Aging in Place: A Medicaid Waiver Can Fill the Gap - October 6, 2026
- Does Every Estate Go Through Probate? - September 29, 2026
