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redryder Asked June 2019

I WANT to sell our house! My husband is on Medicaid. Just got it appraised, how far under the appraised amount can I sell it for?

I really want to get rid of it but don't want to get in any trouble with them. (MEDICAID)

DesertCatlady Jun 2019
Please do not make any legal decisions based on the good intentions and answers in this forum. You need legal advice from a knowledgeable lawyer that knows your state medicaid rules. But I can tell you what happened to me! In MY situation, Medicaid required: the house had to be sold FMV, and no less. How to determine that? Only way for us was a FMV appraisal. It cost 300.00. Family was wanting to give it to a flipper for 80K and get rid of it. NO NO NO said the lawyer. so we got the appraisal, cost for that came from moms checking account. house was sold before it was even on market, we got lucky. your property tax valuation has NOTHING TO DO WITH FAIR MARKET VALUE. i would be terrified, after what we have been through to try to do any of this without a lawyer you can trust IN YOUR AREA who is very well educated on MEDICAID rules for YOU. i do wish you luck, and i hope your area is more kind to you than the state of indiana Medicaid system has been to me and my mother. i am grateful to them, of course, for helping, but one teensy mistake and the penalties are huge.

mmcmahon12000 Jun 2019
If you sell it that's EXACTLY what's gonna happen. By selling your house UNDER fair market value, Medicaid will then penalize your husband. How long will depend on how many months he could've lived off the funds from the sale of the house HAD IT BEEN SOLD AT FAIR MARKET VALUE. So, whatever you do, DON'T SELL IT FOR LESS THAN THAT. And for heavens sake, contact an attorney who specializes in Medicaid. They'll give you advice on what to do.

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97yroldmom Jun 2019
RedRyder has on her profile that her husband (61) is already in a NH on Medicaid.

Regardless of NY Community Medicaid look back, “Chronic” Medicaid would still have a five year lookback.

Mhillwt Jun 2019
Igloo there is a 1 month lookback in nys for community Medicaid ie you can transfer assets before applying the following month ..

igloo572 Jun 2019
Red - medicaid seems to want it sold at FMV, which usually is based on what your tax assessor has the property valued at.

Problem can be that assessor value is inaccurate.

I’d really suggest you look at your assessor bill and then take a hard realistic take on your home compared to other homes of similar sq footage and # of bedrooms & baths that are currently for sale to see if the assessor value is realistic. Often for seniors - since taxes are frozen & have a homestead exemption - if their property value is way way over valued due to comparables in the area are based are renovations or tear downs/new builds, the elder owners don’t mind as your taxes are low & fixed. But if assessor has it at 30Ok, medicaid will want it sold close to that. Problem often is that your place isn’t a300k home as it isn’t renovated & has decades of delayed maintenance. It’s more 175k value.

You’ll need to get documentation to show why it’s legitimately 175k. This can be done by getting it inspected & the inspectors report given to the appraiser who does a detailed specific valuation of your house. Both the inspector and appraiser should be licensed by the state and each places some sort of seal on their report. It’s a legal document so Medicaid has to accept the valuation.

Another issue to keep in mind is that selling house produces income & assets that are community property AND community spouse are allowed their own income (not counted) and assets (will have a max value) under most states Medicaid rules.

So $175 k from the sale is 50% his and can take him over Medicaid asset limits. How to get around this for couples gets complicated..... you could buy a new, more modern place for 175k so there no net $ to either of you. If you have no or very minimal existing assets, his 87k share of $175, might be able to just go into your allowed CS asset fund. CS asset for most states at 119/120k for CS who have a spouse in LTC Medicaid. So it’s never an asset to him as far as Medicaid is concerned. But how to do all this is not simple, really I’d get a NAELA or CELA level of elder law attorney to go over options that can be possibilities for a CS situation.

To me a lot of what to do for couples depends on if he is in a NH and you are a still living in the community spouse and likely to stay a CS for years more, you imo kinda want to plan $ way way different than a spouse who is likely to go into a NH yourself in another year.

So what’s your backstory.... are you a much younger &/or healthier spouse? likely to live independently for awhile? Possibly for a decade more than hubs? Hubs is LTC Medicaid or still at home getting community based Medicaid? You still want to live on your own? Or are you needing AL?
DesertCatlady Jun 2019
My AZ tax assessor says my house has an assessed value of 20K. It could easily be sold for 200K. Assessor values are not a reflection of FMV in any way in 5 states I have worked in. Medicaid required my mom to have either a RE Agent do comps or an appraiser do a FMV. I know it is different in other states, but do not want OP to use her tax valuation as a indicator of FMV, in her state it may be totally inaccurate and based on strange things like how close the fire dept is to her home, if she is rural, if it is a manufactured home, and the price of land could have skyrocketed which will be reflected in an appraisal and comps, but takes years and years to catch up on valuation. Also, in our state and many others, NO INSPECTION REPORT MATTERS to the appraisal. AT ALL. In some states, you are not allowed to sell your home UNLESS you have a RE Agent. So she really does need legal advice from an actual lawyer in her area well versed in elder/medicaid issues, as you noted.
JoAnn29 Jun 2019
Don't think any trusts can be set up once on Medicaid.

Sorry, but in my state, they are not very good at wanting anything but what is considered Market Value. I used a lawyer for Medicaid because of Moms house. I had the sale price set at 70k when I applied and was told no less. As the house sat, it got worse and worse. Lawyer was needed to negotiate with Medicaid if we got an offer less than 70k. But he cost Mom 5k.

You can call husbands caseworker and run it by him.

Riverdale Jun 2019
You should get a sense of the real estate market where you are. I am trying to sell a house in a suburb of NYC which presently is a terrible market for sellers. This season there is no reality to estimates from online sites. Appraisals will certainly change once this season is technically over. It is truly a nightmare and I can't imagine how Medicaid could have any sense of accuracy but you may be in a different area with a different market. I have 3 grown children who all live in different parts of the country with very different housing markets.

TNtechie Jun 2019
You might want to see an attorney. A couple in my extended family was able to sell the house and put ALL the money into some kind of trust where they used the interest and principle to pay rent and utilities without impacting Medicaid. Somehow the way the trust was set up it was assessed the same as if they still owned the house and the state could place a lean on it to be paid after their deaths (just like a house). Since Medicaid is different in each state, I have no idea if this is possible outside of TN or even still allowed in TN today.

Mhillwt Jun 2019
if you have spousal community Medicaid(home aides), you cant have more than I think $21,000 cash in the bank.....if you are single community Medicaid - its $15,450 - in NY, Community Medicaid has no lookback - meaning - I could sell my house for $1000000 today and then transfer it to my child tomorrow with no issues as opposed to INSTITUTIONAL Medicaid(nursing home) - there is a 5 yr look back....
igloo572 Jun 2019
Mhillwt - 100k property sale will be recorded & in your states database. Month of the sale it’s income to you and then an asset for all months afterwards. The $ will surface & to the penny.

Both community based Medicaid & LTC Medicaid are “at need” program requiring one to be at need both financially and medically for the care you’ve been evaluated to be requiring. Each state sets the “at need” amounts. I just cannot see any state - even NYS which has very high costs of caregiving do bigger asset maximum- allowing you to have 100k in assets and not be paying for your care costs. You’re not at need financially.

Also if you went on community based Medicaid fairly recently- like within last decade - & were over age 55, Medicaid is required to attempt a recovery or recoup on costs paid for ANY Medicaid programs. Not just LTC Medicaid. Just how this is done depends on property laws, Medicaid administrative code in NYS and how Title company do searches for mortgages. If your state allows for predeath placement of Medicaid lien, there will be a glitch in being able to do a clear title.

Please, please, Before you go and sell house & gift $100,000.00 to your kids, see a NAELA or CELA level of elder law attorney to come up with options on how to deal with a future sale.

5 yr lookback means getting to July, 2024 to be beyond any transfer penalty. That’s a long l....o...n...g time.

If you already show to right now -June 2019 - to be “at need” medically for care, another 5 years probably means you will need increasing care each year. 5 years poorer and sicker. 100k gifted now will be a serious transfer penalty for anything Medicaid LTC before July, 2024. Avg Medicaid room and board reimbursement runs $180 day. $100k = 555 days of ineligibility for Medicaid LTC eligibility. Yeah a year & 1/2 of ineligibility. Really see an atty, preferably before you go to the Act of Sale to come up with options.
97yroldmom Jun 2019
Hi RedRyder
Here is a link with a discussion on buying a home where Medicaid is involved.
You might find it helpful.

https://www.agingcare.com/questions/house-sold-at-appraised-value-due-to-owner-on-medicaid-199843.htm?orderby=recent

worriedinCali Jun 2019
You have to sell it at market value. I was told by our appraiser that the appraised rate is something like 20% higher than the market value but I don’t know if that’s true.

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