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I am doing the numbers and see no downside. Our mother is getting ready to enter an assisted living facility, she has (had) $150,000 in a bank account. $42,000 has already been gifted away. If we gift away the balance before we make a Medicaid claim, then acknowledge that the entire $150,000 was gifted withing the 5 year look back period, the will take the $150,000 and divide that by the Medicaid divisor for our state ($8,084 per month) to get the number of months that she would be excluded from receiving Medicaid benefits (about 19 months). So for 19 months, we have to pay for her assisted living cost. Let's assume that it does cost $8,000 per month. We pay 19 months at $8,000, less the $2,200 per month that she gets from her pension and SS, that comes to $110,200. So at the end of 19 months we are left with $39,800 that we wouldn't have had if we didn't drain the account. Am I missing something here or is this the way to go?

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Does she oen any real property? Do you want to avoid probate? If so, check with an elder care lawyer about a trust. The money could also be put in a trust, for her care, and not gifted.it counts as property then, not income, and might be financkially advanyageous...even if she had a share of cost with Medicaid due to the lookback, it might be less than a couple thousand a month
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Personally, I do not want to put her in home of any variety other than my own. My family thinks I am nuts for wanting to take her in. I just look at most of the facilities that Medicaid would allow and I think "I would never stay there". So that really makes the entire issue moot if I take her in, but I will likely need some kind of weekly assistance and I believe Medicare provides for that.

She is in an assisted living facility now that we like but since her stroke she has lost some abilities and we are unsure if she will be able to continue in the AL facility where she currently resides. We will see.
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Also moms income would need to be within whatever your state has as its income ceiling for Medicaid . At $ 2,200, she may be over the income limit to begin with. If your mom was my moms neighbor she'd be over as income ceiling was $ 2,064 when I did my moms application.

Vikki's point on the copay is super important - the minimum 20% shared costs to pay for Medicare adds up.

Mom has funds. Take her & her purse to see elder law attorney.
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I got a legal consultation from someone knowledgeable in Medicaid in our state and got precise answers to the question as well. You also should consider what happens to Medicare and the portion of healthcare expenses she or you will have to pay due to non-qualifying for Medicaid. Also, think about whether there is a waiver program for home health if you will want that as an option. You will be paying for assisted living in any event, as Medicaid covers skilled nursing, and another factor would be whether skilled nursing facilities that accept Medicaid would be the ones you would want to use.
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Thank you for your thoughtful reply. It is greatly appreciated and we will take it under advisement.
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Hmm.....but what IF your states program won't cover her AL?
Transfer penalty formula is based on skilled nursing reinbursement in a NH.

AL coverage - if your state even does this - is a medicaid waiver program. It is diversionary funding. It is not dedicated medicaid funding as LTC in a NH (skilled nursing services would be). most states Medicaid do not pay AL. For those that do, the program could change and no more $ - this is happening right now with PACE - or it can limit funding to certain eligible groups (like dialysis or brittle diabetics get priority) so your mom will never be eligible.

Another thing to consider is that the vendors who participate in waivers can limit their participation. This is why you often read, the AL took mom but she had to private pay for 2 /3 years before eligible for the medicaid waiver. For the facility, having 5 beds waiver available is a ok risk financially as many on the list are going to not ever need the bed as they will die or transition to needing a NH. Comprende?

What will be likely is that if mom gifts 150k, family will need to private pay for her AL costs for however long she is good for AL. Whether 6 mos or 6 years. There will always be someone else more eligiblity priority than her. Then when she needs a higher level of care in a NH, she applies for Medicaid. Now although she now qualifies for medicaid as she has met the " need" for skilled nursing care and is now impoverished so "at need" financially due to the 150large in gifting, she will be ineligible for medicaid to pay. & for 19 months you or someone will need to private pay the $ 8,084 a month or whatever it has risen to in 2019, 2022. ..transfer penalty starts from the date of the NH Medicaid application.

Mom has 100large, perhaps rather than trying to game the system instead be glad that this enables you all to have choice as to where she lives. The documentation required for Medicaid is basically an all access pass to their lives & finances. And with this all access pass you don't get the cool lanyard to wear backstage or the band tour T shirt.
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That is what I have read. The look back period, for purposes of this example is a moot point since we are acknowledging up front that all monies disbursed are within the look back period and will be subject to inclusion of the penalty. It's just that as I run the numbers, I cannot see a disadvantage to withdrawing all of the funds, putting the money aside and taking the penalty. I'm wondering if I am missing something.
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I thought the lookback period starts from the date of application for Medicaid. Is this right?
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Yes the gifted funds have been and would be put aside for her care.
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Okay, now I see your point and how you arrived at the 19 months. I've sent an SOS to Iggy; she's the expert on this.
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Am I correct in assuming that the gifted funds would in fact be used for her care? If so, I'd be curious to know what arrangements will be made so that the funds will in fact be specifically allocated and reserved for her and that the recipients of the gifting won't have any access to the funds at all.

Perhaps I'm misunderstanding your plans, but I thought the look back period extended to the time of gifting, which would be, say in 2015, and then would run forward for another 5 years rather than 19 months. I'm not sure I understand what the 19 months represents or what its significance is.

Iggy, are you out here - this is your area of expertise!
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