Is there a way to gift or sell Mom's second home to a family member so she can get Medicaid to help pay for her medications?

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My disabled mom (64 years old) is currently on Medicare and Medicaid says she will not quality due to the fact that she owns two houses. One of the houses is an old lake house that is falling down and not worth much, and she does not want to sale it due to the fact that it was my dad's favorite place in the world and it belonged to his uncle. Grandkids don't want her to sale it either lots of memories there. Is there a way to gift it or sell it cheap to a family member so that she can get Medicaid to help pay for her medications? Her disability check is 1,200 and her medicine is $800 to $1,100 a month with Medicare. That along with her utilities and car insurance she usually doesn't have money for food or necessities. I help her when I can, but I have 3 kids, two of which will be in college next year. I have read about the look back period but how will that affect her while living at her own home?

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Perhaps this is off base, but does your Mom have Medicare D to cover prescriptions?
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Janie - you have been given some really solid suggestions regarding selling the lake house......but I'm seeing bigger red flags for mom (& you) beyond the lake house/Medicaid eligibility situation. Mom can't afford her primary home.

It sounds like mom is needing help to pay for something every month. Even if she had the full 20k, it just puts off her being back at need for a few months. If sold & paid over 10 / 20 years, its just not that much $ and probably won't keep up with increasing health care & living costs. She back in the same $ bind again. What maybe would be an idea is for her to sell the lake house and if possible really look at her selling her primary home as well and moving her into some sort of independent fixed income or congregate living situation that is designed for thise with disabilities.. Selling her home could give her $ to have better choices. At 64, she's quite young and realistically can family be pitching in to be paying her living expenses as needed for another 10...20 years?

Repaying family will look like "gifting" and not allowed by Medicaid and will place a transfer penalty on her.

Also keep in mind that If she goes on Medicaid, Medicaid is required to attempt recover all $ paid on her care from any sale of the primary home - whether when she's alive and sells it or dies and it becomes an asset of her estate. If family want & expect to be repaid or inheirit, it won't be easy to do.

If mom insists on staying in her home, I'd suggest you & her meet with an elder law atty to discuss selling lake house, perhaps doing a SNT once it sells and discuss how to do an agreement or promissory note for $ loaned to her along with updating her legal paperwork.

As an aside on the situation...we have kid at college, & costs are way WAY different from when we went to college. You are likely to get a call that they need another $ 385 for books, meal plan, another other deposit, etc and they needed it yesterday. ??? Who is going to be the priority....mom or your kids??? To get any financial aid, loans, etc, they & you have to do FAFSA, and there is no "I need to give $ to mom" dispensation with FAFSA as its strictly based on your tax filing and mom is not your dependent for taxes.
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I agree with the suggestions of the family purchasing this little shack if it means so much to them. Memories are free, little lakeside cabins or medical care are not.
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Great idea Pam, if it's only worth 20,000, that shouldn't be that hard to come up with in a large Family that truly wishes it to stay in the family. As one poster mentioned, put up, or shut up! At this point, her livelihood and medical need must come first! 20 grand, come on people, step up! Someday, just the lake front land alone should increase in value! Someday!
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Seriously?
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Kids can buy it for fair market value and she can hold the mortgage at current rates. It would give her extra money and the cottage stays in the family.
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No the lake house is too far away from family and her doctors. It's only worth about $20,000 at most for land, and houses/land are not selling in that area.
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With us the family cottage was sold to a co-op of the family members who were interested. It is easy to make a fuss that things should be kept in the family, but if they aren't willing to put up then they will just have to shut up and live with the consequences.
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Janie, in order to sell a house it would have to be sold at fair market value and it cannot be "gifted" to someone else. Once the house is sold, then the equity from that sale will be used for your Mom's care and meds. Once the equity is used up, then your Mom can reapply to Medicaid.

Seems sad that your Mom can barely make it money wise on her own with her current house. Would she consider selling her current home and moving into the lake house, or is that too far away from neighbors, doctors, family, etc?

You shouldn't be helping your Mom with money when she owns two houses. Something has to give. I have a lot of memories of my grandparents house but the house and barn had been torn down decades ago. Memories survive in photos and in one's mind, it doesn't have to be a physical item.
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