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Parents have $50,000. If they buy a $40,000 home and later go to a nursing home. And the cost exhausts the rest of their money, and they qualify for Medicaid, and the home is not included in the spend down, what happens to the home at the time of their death.

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I believe Medicare will pay for nursing home care for up to 100 days after a 3 day hospital stay. What they're paying for is rehab. If the individual ends up needing to become a full-time resident, then Medicaid takes over if they do not have the money for private pay.
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Does the "MERP" also apply to parents on "Medicare"? I mean the part about the state coming back to try to recoup $s then too.
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What is MERP???
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what if you did not tell there is property in another state?
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Paula - all states are required to have MERP (Medicaid Estate Recovery/Recoup Progam/Policy) in order to be in compliance with the feds for getting Medicaid funds. MERP is administered by each state and under each state special twist of death, estate and probate laws.MERP has really geared up the past couple of years too. My experience is that the MERP form is done as a acknowledgment of fact on the Medicaid application and recertification.

Jay - Realize that when they apply for Medicaid, they have to be at-need with income & non-exempt assets at about 2K each. Exact varies by state. Basically they have to be impoverished. But the person's home in most states are exempt assets for their lifetime. I think this is done as to allow the individual the "right to return" as being in a NH is voluntary. But what seems to happen, is that in pretty short order the house gets sold because of the costs and time involved in dealing with the property. Keep in mind, that Medicaid for NH requires a co-pay. The co-pay is all their monthly income less whatever is their state personal needs allowance. So say mom get's $ 800 in SS and $ 1,000 in retirement. Dad get's the same. They live in TX which has a personal needs allowance of $ 60.00 a month each. All their other income MUST be paid to the NH as their co-pay. $ 120.00 will cover mom's hair salon visits at the NH, dad's barber & shave, their cable or phone and clothing replacement, etc. Realistically there will be NO $ from them to pay taxes, insurance, repairs, utilites, do yard work, etc on the home. If family cannot do this for the possible years & years mom & dad is in the NH, then the house gets sold. Just not feasible to keep it. $$ is spent down on their care.

But they don't have to sell the house. MERP has all kinds of exemptions and if the heirs qualify for one or more of the exemptions, then it might be worthwhile to pay the whatever's on the property and file for exemptions from MERP and do all the specific documentation required to make it work in a very tight time-frame.

When they apply for Medicaid there will be an acknowledgement of MERP form in the application. It is in all the applications whether or not they have a home. How MERP runs depends on your state law (like it's an actual lein on the property or a claim against the estate). Really if there is property, you should meet with an elder care attorney before applying for Medicaid.
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Most states have "estate recovery" programs that will go after the house after the death of the Medicaid patient. They can recover up to the amount that was spent by Medicaid on the patient's behalf.

I've never understood the advantage of the home being "exempt" if the funds have to be relinquished anyway in the end, but I guess the idea may be that funds tied up in real estate are illiquid and can be hard to get at quickly, while a person's need for care is immediate and must be paid for now.
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