Tag Archives: MEDICAID

Should I cash in my insurance policy to get Medicaid?

Q: If I have a whole life insurance policy. Do I have to cash it in to qualify for MA or do they put a lien on proceeds at my death? I have $300,000 whole life with $25,000 cash value. Do I have to cash in to access the cash value or would they put a lien on the proceeds at my death, in order to qualify for medical assistance to pay for nursing home care?

A: Your question can only be answered with an experienced elder law attorney reviewing all of the facts. Generally, if you don’t want to lose the insurance policy, many insurance policies allow you to “borrow down” the cash value of the policy. Then you can spend those funds in an approved way that will allow you to qualify for benefits. This way, you can retain the benefit of the insurance coverage for your beneficiaries when you pass. You need an experienced elder law attorney well versed in Medicaid regulations to look at your situation and you want to have the insurance company carefully explain your options.

When should I file my parent’s Medicaid application?

Q: When should I file my parent’s Medicaid application for long term care? He should qualify as medically necessary, but only after we spend his 40k savings on private care. Should I file now or after he spends the money?

A: It is highly advisable not to do this on your own. If there is $40,000.00 in assets to spend down, you need to do this with the advice of an experienced elder law attorney. There are ways to shelter some of these assets and it will be well worth the legal fee as it will likely save a portion of your father’s money which will otherwise go to Medicaid.

 

When should I file my parent’s Medicaid application?

Q: When should I file my parent’s Medicaid application for long term care? He should qualify as medically necessary, but only after we spend his 40k savings on private care. Should I file now or after he spends the money?

A: It is highly advisable not to do this on your own. If there are $40,000.00 in assets to spend down, you need to do this with the advice of an experienced elder law attorney. There are ways to shelter some of these assets and it will be well worth the legal fee as it will likely save a portion of your father’s money which will otherwise go to Medicaid.

 

If I am in Bankruptcy, can my aunt put my name on the deed to her house?

Q: In Chapter 13 can I be put on another house’s deed? I declared Chapter 13 about 3 years ago and have been making payments. My aunt wants to put me on her deed. What are the ramifications of that, and the risks to her? She will be entering a nursing home and doesn’t wish to sell the home.

A: Two issues. Is this wise to do for estate planning purposes for your aunt and is this wise for you to do while you are in bankruptcy? From an estate planning point of view, if she titles the house jointly with you, only half of the value of the house will be subject to inheritance tax when she dies. Since the applicable inheritance tax rate for a nephew is 15%, this could save some money. The negative side of such transfer is that if in within five years following the transfer, your aunt needs to apply for Medicaid, such a transfer could make her ineligible for Medicaid funding. The house would have to be included in her assets subject to the Medicaid claim and you may be forced to sell this house unless you could pay the fair market value to Medicaid. This is of course unless some Medicaid exclusion applies for example if you lived in the home as her caretaker for a period of two years prior to the application date. If your aunt really foresees Medicaid funding in her future, you should have her consult with an attorney versed in Medicaid law in order determine if she can shelter some of her estate now perhaps through a Medicaid trust. As far as your bankruptcy, I would check with your bankruptcy attorney as the acquisition of an interest in real estate while under a bankruptcy plan, may, violate your agreement with the trustee assigned to your bankruptcy case.

Opening a Home Care Agency. What kind of lawyer do I search for?

Q: I’m opening a Home Care Agency. I was doing a lot of research and keep seeing that I should have a lawyer on “standby” my question is, what kind of lawyer do I need to oversee the operations and make sure everything is legit. Someone I can call if I have legal questions. What exactly does this lawyer do when your hired for something like this

A:  I wouldn’t be in a hurry. I would network, ask around for referrals and meet a few attorneys. Talk to some people in your field who have used attorneys. You will want to find an attorney who has business law skills as well as estate and elder law knowledge. The lawyer should have some experience in state regulations relating to nursing, nursing homes, home nursing care, Medicare, Medicaid, be versed in forming corporations or LLC’s, understand income tax laws, contracts, and ERISA and employment law. You can also call the Allegheny County Bar Association, Lawyer Referral Services, for a referral.

Can grandmother give money away after she is in a nursing home?

Q: How much can an independent senior (84 years old) gift money without getting penalized if admitted to a nursing home shortly after? How much money can be gifted to children each without penalization? How much money may be gifted to grandchildren?

A: The Federal Gift Tax Exclusion allows you to give $14,000 in cash or other assets each year to each of as many individuals as you want without dipping into the basic exclusion. However, if grandmother may need to apply for Medicaid funding in order to afford her nursing care in the next five years, these gifts may not be advisable. Medicaid eligibility rules have a five year look back on all such gifts or transfers made without consideration. Therefore, any gift made in the previous five (5) years of the Medicaid application and eligibility, can result in her being ineligible, or her being excluded from funding to the extent of the dollar amount of monetary gifts made without consideration. If you believe that Medicaid may be in her future, it would be wise to have grandmother consult with a lawyer versed in Medicaid law, now. There are ways of excluding some of her estate from a Medicaid claim. There are exclusions and exceptions, trusts can be created and there are allowable purchases that can be made in the Medicaid spend down process.

If wife transfers house to me, then goes into a nursing home, will she obtain Medicaid?

Q: If my wife transfers her house to me, is that a disqualifying transfer under Medicaid in Pennsylvania? I was told that if my wife goes into a nursing home and then immediately transfers her home to me (the house is in her name only), then she can still qualify for Medicaid – is this true? Isn’t there a 5-year look back period? I was also told that the look back period was eliminated.

A: Transfers between spouses generally don’t trigger penalties. The five year look back is alive and well. A spouse’s principal residence is an exempt resource. The PA Department of Public Welfare and Medicaid rules are complicated and if you have assets worthy of preserving, doing this alone without the assistance of an attorney can end up costing you. Consult an elder law attorney to make sense of all of this.

How does the Medicaid look-back rule affect property transferred to adult children?

Q: I’ve been told the rules differ from state to state. The surviving parent lives in Massachusetts. We live in Pittsburgh. If property is transferred to an adult child more than 5 years before the parent requires Medicaid assistance, how is the look-back rule handled?

A: Per federal law, the look back period runs forward 60 months preceding a transfer, so gifts 61 months before a Medicaid application are outside the look back period. Consult an elder law attorney or estate attorney versed in Medicaid law. Minor timing errors can cause thousands of dollars of loss. It sounds like you made the look back period but would consult with a local Massachusetts attorney.

When elderly mom enters nursing home, can I keep her house?

Q. When my elderly mother enters a nursing home, can I keep her house? I am her 24/7 caregiver and have no home otherwise. I have both medical and durable POA and I am responsible for 100% of the household expenses, upkeep and taxes. The deed is in her name. I don’t know what other details are required here. I have lived here and been her caregiver for 12 years.

A. Make sure your mother has a will in place that leaves the house to you. If there are no other children and she has no surviving spouse, you can inherit the house even without a will. However, it is best for her to have a will. If she eventually runs out of cash or liquid assets to afford the nursing home, you may have to apply for Medicaid/PA Department of Public Welfare (DPW) for her. They may have an interest in the home but as a surviving child/caretaker living in the home, they will not force you out of it. When she dies, DPW can go after the deceased person’s property under the Medicaid Recovery Program. However, given the fact that you were her caretaker for over two years prior to DPW eligibility, you can file for relief as an “undue hardship” under the DPW rules and probably keep the house. See a lawyer for a more thorough examination of your mother’s situation in light of Medicaid rules and regulations.

Denied Medicaid because I have too much money in my bank account.

Q. I have been denied Medicaid because I have too much money in my bank account. What can I do with the excess without spending it? The state has asked for receipts or detailed list of expenditures.

A: There are various ways to spend down excess Medicaid resources. Sometimes gifts are useful but other they can also disqualify you. Buying things and paying debts often are good spend down techniques. However, you really need to consult with an elder law attorney before you set out to do this.