DebbieF - The NH Medicaid applicant home & car is considered an EXEMPT asset. The home is limited to a set value - most states have this @ 550K but some east coast states have the value @ 800K. They can keep both house & car and for the rest of their lifetime. What is important is that they qualify both medically in needing skilled nursing care AND financially for your states Medicaid limits (this usually is 2K in NON-EXEMPT assets and about 2K in monthly income (the income amount varies by state).
They can keep their home. Now if they are married, and healthy spouse is staying in the community, then they get CSRA to enable them to live at the home & pay costs. If the NH spouse dies first, the community spouse files MERP exemption to get the home.
But for a widow or widower, keeping the home sounds just dandy, but here is the downside: once they enter a NH on Medicaid they are required to do a copay or their "SOC" share of cost in Medicaid-speak of all their monthly income to the facility less a small personal needs allowance (PNA). PNA vary by state from $ 35 - $ 105 a month. Really the PNA is designed to cover their beauty salon monthly charges and some personal care products or clothing replacement. If your parent has a phone & cable, those charges could be more than what your state even allows for the PNA. The elder will have none-nada-zero-zilch of their $ to spend on the house. Someone in the family will have to pay all the costs on the home (taxes, insurance, utilities, maintenance, etc) and for the rest of the elders lifetime and then afterwards through the probate process and deal with the required MERP filing against your elders estate which has the home as an non-exempt asset after death.
If you go this route, I'd really suggest you do a hard look at the costs on the home based on the past couple of years and see if you can fully afford all this on your own without any problems for now and several years. You also need to be able to be very OCD in keeping documentation on all the costs on the home paid by you or others & in detail. Why?- because you are going to need to file all those costs paid as your own claim against the estate in probate and are going to need to inform the state that all those costs are to removed as per whatever your state has in its administrative code from the MERP Medicaid tally they want to be reimbursed for. If the costs on the house are affordable and there is a reason to keep the house and family can meet some of the exemptions and exclusions of MERP, then keeping the elders home can make total sense. But imho you need to be in this for the long haul to make this work, whether it's 6 months or 6 years left in your elders life.
Now if someone is living in the home, then they are expected to pay the costs on the home without getting those costs as an exemption. The details on how the exemptions and exclusions work should be in your states Medicaid website. Also its in your states Administrative Code - sometime the AC is easier to understand.
What is often the problem is that family is all "we want to keep grannies house" initially, then Uncle Bill stops mowing the grass after 4 months; Sissy pays the insurance but Bro. Bob doesnt pay the property taxes….and it falls to 1 person in the family to do everything & they just can't. The house ends up being sold and all the proceeds from the sale have to go to pay for the NH as grannie is now over the Medicaid asset limit as she got $ from the sale of the home. Every situation is unique and you know your family and your finances best to see if it is feasible to keep the elders home.
There are a couple of folks on this site who have been through the MERP process: 1 was able after 2 years to negotiate it all down to 4K to get the release of the claim against their mom's very modest 30K home; the other transferred property as per the will within the family & is going to let it sit for 10 years till the statute of limitations is done. Whatever route you do, you really have to have the income to pay whatever is need to be paid on the house & legal costs. In many ways, it's like having a second or third home but without any assurance of ownership, so it runs a risk. Most of us cannot afford a second home and most are risk adverse, but if not, then go for it!
If you decide to sell the home, you want to see if you can get some of your elders SOC income diverted to cover "market" costs to have the house listed with a Realtor. There will be costs to selling the house: having yard done; getting it cleaned; utilities on; increased insurance coverage, etc. Otherwise family pays with probably no reimbursement.
They can keep their home.
Now if they are married, and healthy spouse is staying in the community, then they get CSRA to enable them to live at the home & pay costs. If the NH spouse dies first, the community spouse files MERP exemption to get the home.
But for a widow or widower, keeping the home sounds just dandy, but here is the downside: once they enter a NH on Medicaid they are required to do a copay or their "SOC" share of cost in Medicaid-speak of all their monthly income to the facility less a small personal needs allowance (PNA). PNA vary by state from $ 35 - $ 105 a month. Really the PNA is designed to cover their beauty salon monthly charges and some personal care products or clothing replacement. If your parent has a phone & cable, those charges could be more than what your state even allows for the PNA. The elder will have none-nada-zero-zilch of their $ to spend on the house. Someone in the family will have to pay all the costs on the home (taxes, insurance, utilities, maintenance, etc) and for the rest of the elders lifetime and then afterwards through the probate process and deal with the required MERP filing against your elders estate which has the home as an non-exempt asset after death.
If you go this route, I'd really suggest you do a hard look at the costs on the home based on the past couple of years and see if you can fully afford all this on your own without any problems for now and several years. You also need to be able to be very OCD in keeping documentation on all the costs on the home paid by you or others & in detail. Why?- because you are going to need to file all those costs paid as your own claim against the estate in probate and are going to need to inform the state that all those costs are to removed as per whatever your state has in its administrative code from the MERP Medicaid tally they want to be reimbursed for. If the costs on the house are affordable and there is a reason to keep the house and family can meet some of the exemptions and exclusions of MERP, then keeping the elders home can make total sense. But imho you need to be in this for the long haul to make this work, whether it's 6 months or 6 years left in your elders life.
Now if someone is living in the home, then they are expected to pay the costs on the home without getting those costs as an exemption. The details on how the exemptions and exclusions work should be in your states Medicaid website. Also its in your states Administrative Code - sometime the AC is easier to understand.
What is often the problem is that family is all "we want to keep grannies house" initially, then Uncle Bill stops mowing the grass after 4 months; Sissy pays the insurance but Bro. Bob doesnt pay the property taxes….and it falls to 1 person in the family to do everything & they just can't. The house ends up being sold and all the proceeds from the sale have to go to pay for the NH as grannie is now over the Medicaid asset limit as she got $ from the sale of the home. Every situation is unique and you know your family and your finances best to see if it is feasible to keep the elders home.
There are a couple of folks on this site who have been through the MERP process: 1 was able after 2 years to negotiate it all down to 4K to get the release of the claim against their mom's very modest 30K home; the other transferred property as per the will within the family & is going to let it sit for 10 years till the statute of limitations is done. Whatever route you do, you really have to have the income to pay whatever is need to be paid on the house & legal costs. In many ways, it's like having a second or third home but without any assurance of ownership, so it runs a risk. Most of us cannot afford a second home and most are risk adverse, but if not, then go for it!
If you decide to sell the home, you want to see if you can get some of your elders SOC income diverted to cover "market" costs to have the house listed with a Realtor. There will be costs to selling the house: having yard done; getting it cleaned; utilities on; increased insurance coverage, etc. Otherwise family pays with probably no reimbursement.