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Transfer penalty.

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From what I read here, there's a 5 year look back period. On the date you apply for Medicaid, they "look back" 5 years prior to that date. If any assets have been gifted away, or major expenses paid that are not usual, then Medicaid will penalize the potential recipient by that amount. It's pretty hard to get away with transfers of assets, if you try to hide it somehow, and it gets uncovered, it only serves to hurt the senior who is in need of care. They will refuse to pay the nursing home bill. And after the senior dies, they will put a lien on the home, and collect their money during the sale process (the title won't be able to transfer to new owner until the outstanding lien is satisfied).
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How does the government determine the amount of the transferred property. If you own a house with your parent and then the parent transfers his share of the property to the son, does the government determine the value at the time of the transfer or at the time of the Medicaid application?
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Mom is in a nursing home. House was sold 5 years ago and proceeds have paid for her care. We are in the spend-down phase. However, I am co-owner of a savings account and a CD with her (not just able to sign checks). How much of the accounts can I keep for myself?
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For transfer penalty, what usually happens is that the state sends the Medicaid applicant or their dpoa a letter that requires documentation to establish whether or not the funds or action in question were spent or done within guidelines. If elder is ruled to be ineligible for medicaid coverage, then Medicaid will not pay the facility. The facility gets the penalty letter too & they will fully expect to be paid for all those days / weeks that the elder has been there. Most admissions contracts have some sort of wording as to what they do if a Medicaid Pending application is denied. They will go after the elder & or their fiduciary or DPOA or spouse to get this paid.

If the transfer is on a piece of real property, all those values are done by the local tax assessor and dovetailed into the states database. It's a simple matchup and to the penny. Transfer penalties vary by state as the equation is based on what your state has as its daily room & board reinbursement rate paid to a NH by your states medicaid program. So like for TX which has a low rate @ $155 a day a 50K penalty is 323 days of ineligibility; but for a state that pays $300 a day its only 166 days. Each state administers its medicaid program uniquely.

One sticky with property transfers is that the amount is usually set on the date of the medicaid application to start the clock ticking on days of transfer too. States in the past used to set date based on when transfer was done but I don't know of any states that allow for this approach anymore. Often family either private pays for the care provided either from their purse or by selling the transferred house; or they move the elder in with them & still face paying the outstanding bill.

Transfer penalties on houses or cars are very difficult to get around as the data is just there.
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Paul, if your mom's name is on anything, it is considered a countable asset...unless you can prove that you made the deposits into the accounts and never withdrew any, then by default everything in those accounts came from mom....and she is not allowed to "gift" it to you within 5 years of a Medicaid application. They will deny her until those accounts are (along with all other assets with her name.on them) brought to $2,000 max assets. If she is over this amount, she could use those accounts to pre-pay her funeral, or re-roof her house but those monies cannot be used for any other purpose than her care (or funeral pre-pay or reasonable home repairs---but some people have done home repairs and gotten penalized so generally not a good idea). You might want to check with a lawyer, one who knows your state's Medicaid rules and recent updates. Good luck.
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