Anyone have experience with reverse mortgage & Medicaid?
My mom has been living in a nursing home for the last 5 months.
She’s had Medicaid for 35 yrs & when she was admitted to the skilled nursing part there was also another application to Medicaid to cover her long term care to stay there.
Currently she (I’m her poa) has been paying the NH the monthly “rent” (they get mom’s SocSec & SSI) - $30 she gets to keep as spending money.
My mom still has her home which has a reverse mortgage on it.
The year isn’t up where they require notification that she won’t be returning so legally she is still able to access the money from her RM.
The question is my mom has already been thru the 5 yr lookback w/Medicaid (RM was taken out in 1997) and her house was put in trust to me then as well).
My mom wants to take out the remaining $40,000 she has from her RM & give it to me so I can buy a home to live in.
The rules have always been when my mom would request funds, the RM back would call her to verify it was her as a method of security.
This time my mom will have to speak w/them at the nursing home since she’s not living at home & has her house phone turned off.
She’s afraid if she tells them she won’t be returning home, they will cancel her loan & she won’t be able to get the funds.
There is the possibility that some of that money will be used to bring my mom back to her home (to die w/hospice coming) because she doesn’t want to die in the NH, but that will cost $ out of pocket so she would use the RM money to pay for that.
We’re advised NOT to tell the RM bank about this & just say that she IS coming home so there won’t be any issues with them giving my mom her money.
Is this doable??
24 Answers
Popular Questions
Related Questions
- My mom is going to a nursing home for rehab. If she doesn't improve and needs to stay there permanently, what options does she have?
- What is the criteria for receiving assistance? What is the max I can make to qualify?
- My 89-year-old mother is out of savings. Where do I start looking for financial help?
- Can I suspend my Social Security retirement benefits to regain Medicaid eligibility?
Please note that Medicaid is funded by us taxpayers so it wouldn't be fair if Mom has money and she "gifts" it to someone else. Not many people realize this thus are not familiar with the ins and outs of Medicaid.
If your Mom wants to return home, with a Reverse Mortgage as you know, Mom would need to return back to her house within that one year spanned.
Curious as to whom had advised you not to notify the Reverse Mortgage bank that Mom will not be coming home? Your Mom would be in breach of her Reverse Mortgage contract.
In my opinion, you should consult an attorney. What you are proposing sounds as if it might be fraud. You might have other options to access the money without getting yourself into a legal problem. The social worker at your mom's residence might be able to guide you to legal aid resources.
I would be careful about taking legal advice from a forum such as this. We are really more a support group. People can tell you their own experiences, but you need a legal opinion from someone who has seen your mom's RM contract.
Mom can take some of that RM money and use it for a consultation. Find an attorney who will come to the NH and speak to both of you, perhaps with the social worker there.
https://www.onereversemortgage.com/blog/2015/05/how-reverse-mortgages-affect-medicaid-and-medicare/
The short version is "consult an attorney". If mom takes a large sum out of RM, it will disqualify her from Medicaid. In your shoes, I'd find an eldercare attorney who will give you a free consult. If you need more advice than that, withdraw enough to cover her/his retainer.
A reverse mortgage doesn’t affect Medicaid because it’s not considered income (& not taxable btw).
https://www.onereversemortgage.com/blog/2015/05/how-reverse-mortgages-affect-medicaid-and-medicare/
https://www.caring.com/questions/reverse-mortgage-mecicade-medicaire
https://www.agingcare.com/articles/reverse-mortgages-affect-medicaid-153250.htm
I think the idea of bringing mom home with full time care could be the "line" that you use to get mom to talk to the lawyer. Although, in your shoes, I'd examine that idea with great caution before acting upon it. But you really need to get, and take, expert legal advice in this situation.
I really, really think you should consult an attorney on this. If Medicaid doesn't like the transfer, I'd worry they'd look to you as POA and the recipient of the transfer. If you are entitled to transfer the RM money without any penalty, getting legal advice will help you have peace of mind and should protect you. I think this is one of those times that getting over the inclination to avoid the immediate stress of contacting an attorney will be worth the peace of mind and avoidance of hassles later on.
Re: POA, different organizations may request that you provide evidence of your POA individually. Although the NH recognized it, the bank needs to verify also.
I hope you will talk to someone who is familiar with RMs and the Medicaid laws in IL. It seems like a complicated situation, and both the government and bank will want to get as much as they can. I hope you will take care and seek the advice of a professional with experience who can look out for you and your mom's best interests. I hope you are doing all right.
I’ll call the cdelaw.org to see if they can help.
Really appreciate knowing about them. XO
See All Answers