Does an existing credit freeze need to be lifted if one is trying to qualify for nursing home coverage with Medicaid? If so, does anyone know which credit reporting agency Medicaid uses?
The three major credit reporting agencies (Equifax, Experian and TransUnion) allow someone to place a credit freeze on their credit file so that no new credit can be opened on that person without their permission.
Please tell me if your answer is an educated guess, or if you know from personal knowledge. Thank you.
There is the credit puller -- bank, government, landlord, etc.
There is the credit pull-ee -- the person needing credit.
A credit check is done when a hard pull of a credit report and/or credit score is pulled by the puller about the pull-ee.
Some places pull from all three credit reporting agencies and use the first response. Others pull from just one agency. Some use computers to randomly select which agency to pull from.
There are also some limitations on what the credit report will contain as it is weighted towards CREDIT and not ALL bank accounts get reported all the time.
A credit freeze interrupts the puller from getting the pull-ee report and/or score.
With that being how the process works, I suggest asking Illinois Medicaid if they are using a hard pull to find out the credit history of their residents. If they are, in theory, the freeze will stop them from getting the information.
Some states might use this method, but from my experiences, many states use their own integrated asset and financial systems to verify eligibility. These aren't impacted by a credit agency freeze.
So, in general the answer is no. Specific to Illinois however, the final answer would need to come from Illinois Medicaid.
Answer: True and false.
Medicaid can’t access your personal bank statements, but the agency does have a way to obtaining information about your finances. Medicaid has an asset verification system that uses the client or spouse’s Social Security number to pull information on any bank account they have had in the past five years, including the balance.
Medicaid will request that the client verify the balance on each account. If the client does not verify the information, then Medicaid will use the balance obtained from the asset verification system to determine eligibility. If the asset verification system finds that your loved one has $20,000 in a bank account, then it will use that number unless you can verify that it’s different.
Medicaid also conducts property checks using deeds, which are public records. The agency will inform you about any properties they have found through the property check."
Source: https://blog.rehabselect.net/five-common-misconceptions-about-medicaid-eligibility
I recently agreed to be a guarantor on a loan. I waited until the lender contacted me and I asked which agency they wanted unfrozen. I unfroze for several hours while they did their check and reinstituted the freeze.
Is there another reason you are asking about a credit freeze? I wouldn't lift one until it was requested.
The odd truth is that the lifting of a credit free temporarily (you are supplied with a code to do this) is required for a whole lot of things I cannot imagine a good reason for. For instance, it is my understanding that in order to do a Social Secuity on line registration, such a good thing as you can manage accounts online, you have to lift a credit freeze and this is one reason I am not doing it. It seems like a whole lot of trouble to do and a whole lot of messing with something I have done for my own protection.
Alas, I wish you luck in finding out the answer, and hope you will share it with us when you DO FIND OUT.
Perhaps (understandably) they are mistaken because it seems like such a silly question otherwise. But, as you state, there are illogical corner cases where a freeze needs to be lifted. I knew that when I posted. I hope somebody out there understands the question and has the answer from experience.
Also, so far, I've had little luck getting help from my local Medicaid office (Illinois), unless it's for things I can find the answer to myself online. I'm just a few blocks away from the office, so have walked down there several times for answers to less obvious things I can't find the answer to. Every time, I leave without the answer. Sometimes, I'm explaining to them what things like the Caretaker Child Exception is.
Anyways, off my soapbox. Thanks for your time and I will post here if I get an answer.
Having a Credit Freeze is a great idea, I did that for myself over a decade ago. One less thing to worry about :)