Is there a way to shelter a property from going to Medicaid? 10 Answers as of November 14, 2011

My mother is in a nursing home under self-pay but will very shortly have to apply for Medicaid. She owns a house which is rented out. Is there a way to shelter this house from having to have any future proceeds go to Medicaid?

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Goldsmith & Guymon
Goldsmith & Guymon | Dara Goldsmith
Medicaid is entitled to repayment. I will assume that your mother is not married, over 50 years of age, and does not have any disabled children for whom she is providing care, if my assumptions are correct and she does not have long term care insurance, the proceeds of the home will be used to reimburse Medicaid. Since the home is rented out, those specifics need to be addressed, as the home may need to be listed for sale now rather than simply subject to reimbursement at the time of her death. Your mother or her attorney in fact or legal guardian should speak to an attorney about the specifics of her situation.
Answer Applies to: Nevada
Replied: 11/14/2011
Martin Barnes - Attorney at Law
Martin Barnes - Attorney at Law | Martin Barnes
There are circumstances in which certain assets can be exempted from Medicaid claims. Proper handling and reporting of all of your mother's assets is essential to avoid any issues regarding Medicaid coverage for your mother. You should obtain the advice of an attorney who specializes in Elder Law who can advise you of the limitations of Medicaid claims.
Answer Applies to: Indiana
Replied: 11/11/2011
The Law Offices of Laurie E. Ohall, P.A.
The Law Offices of Laurie E. Ohall, P.A. | Laurie E. Ohall
In Florida, if the house is your homestead, then it is not subject to Medicaid (it is considered an "exempt" asset) and does not count toward the $2,000 in assets you are allowed to have. However, you indicated that you are renting the house (therefore, it can no longer be considered her homestead). However, income-producing property is also not considered an asset (just the income is counted against her). There are some things that Medicaid will allow you to deduct from the rental income so that not all of it is counted. Your mother's income will go to the nursing home, less $35/month which she can keep as a personal needs allowance. If her income (including the rental income) is over $2,022 per month, then she will need to have a Qualified Income Trust set up before she can qualify for Medicaid. It may be a good idea to meet with an elder law attorney in your area to discuss the particulars.
Answer Applies to: Florida
Replied: 11/11/2011
The Medicaid rules allow for transferring assets to another person but it must be done 60 months prior to applying for the Medicaid benefit. If the person goes into the Medicaid program the state will place a lien on the property and attempt to collect after the person's death. If a spouse is living in the property the capture will begin upon the spouse's death. Medicaid planning needs to take place 60 months prior to the need or application date.
Answer Applies to: Georgia
Replied: 11/11/2011
Attorney & Counselor at Law
Attorney & Counselor at Law | John Hugger
You may be too late. Every state has a look back period for assets moved out of the Medicaid recipient's name to children, third parties, or a trust. In Colorado the look back period is just under three years. Any assets moved out of her name during the look back period will disqualify her from Medicaid for the amount moved out divided be the average cost of the nursing home equals the number of months of disqualification. Consult with an attorney.
Answer Applies to: Colorado
Replied: 11/11/2011
    Minor, Bandonis and Haggerty, P.C.
    Minor, Bandonis and Haggerty, P.C. | Brian Haggerty
    There may be, but the Medicaid rules are complex and the analysis must always be done in the context of all the information on the person's estate plan and their assets (much more information than you'd want on a website). You should contact a lawyer who specializes in "elder law," to get the straight scoop. Be prepared for the possibility that there isn't much that can be done. The important thing is for the elder to get the care that is right for her. One thing to consider (if the house is generating decent income) is a bona fide agreement to buy the house from her for full value over time (with the rent paying the purchase contract payments). See a lawyer to make sure that is done correctly.
    Answer Applies to: Oregon
    Replied: 11/11/2011
    The Center for Elder Law
    The Center for Elder Law | Don Rosenberg
    Absolutely, Even though Michigan has now enacted estate recovery it is only a probate recovery. If your mother would establish a lady bird deed she could protect the home, avoid probate and avoid any Medicaid complications. Additionally, if your mother is renting her home then only 35% of the rent will be counted as her patient pay amount and she can keep 65% of the rent to support the home. In fact you can rent it from her for little and then sub-lease for more and protect more income. Also, you still may be able to protect 50-70% of her remaining assets.
    Answer Applies to: Michigan
    Replied: 11/11/2011
    Law Offices of Brian Chew
    Law Offices of Brian Chew | Brian Chew
    You need to contact an attorney regarding placing the home in an irrevocable trust. This will shelter the home from any medical recovery lien and she will likely not need to claim the rental income as income for medical purposes.
    Answer Applies to: California
    Replied: 11/11/2011
    Ashman Law Office
    Ashman Law Office | Glen Edward Ashman
    Not unless she will wait 5+ years to go to the nursing home. This should have been planned when she was young.
    Answer Applies to: Georgia
    Replied: 11/11/2011
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