How can I reduce mom's estate and still have her qualify for medicare?

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My dad lives in a nursing home now and after a 3 month process was finally approved for Medicaid. My dad did not own a home or a car and did not have a lot of money so I guess the process was fairly easy but that's relative because going through this process almost drove me insane. But if I can do it anyone can! :-)

The spenddown is the big thing. If there is money or assets or property that will have to be dealt with. An attorney can help you if there is a lot of money involved but a social worker can be of assistance as well. There are all kinds of ways to liquidate assets and qualify for Medicaid but in doing this you'll need guidance from either an attorney (if there's a lot of money you're dealing with) or a social worker (if you're not dealing with a lot of money). One of the most popular and easiest ways to get rid of money is to purchase funeral and burial services for your mom. I know it's morbid and not something any of us want to do but it is acceptable by Medicaid to do this. Be careful of 'gifting' money in order to spend down, there are penalties for that although my dad gifted me a small amount (under $10,000) but was not penalized for it although we thought for sure he would be.

The more money there is, the more assets (including life insurance policies) there are the more complicated the Medicaid process can be. My dad's Medicaid caseworker was very good and sat with me the day I went to apply and explained everything to me until I understood it. I called Medicaid every Mon. morning to see how the process was coming along and several times they would tell me that they needed this document or that document. It drove me crazy. I gathered what they needed, faxed it, then found out the next week when I called to check in that I was given the wrong fax number! It was 10 miles of red tape but somehow I trudged through it and my dad was approved.

I was given a very helpful Medicaid packet by my dad's NH and it had all kinds of information in it. I'm sure you can find the same information by looking up Medicaid in your state.

It's a tedious process but you can do it! :-)
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Another thing to consider is if there is a living spouse, they can stay in the home, but once the surviving spouse dies, the estate is expected to reimburse the medicaid system for funds that have been paid for the care of the spouse who received benefits.
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INCOME: Exact income max is set by each state. Most states have “income” at $ 2,022 per mo but it can be more or less. TX is $ 2,094. Income is whatever $ they get monthly – retirement, SS, annuity, etc. If they get something that pays annually – like a dividend – it can be sticky if the amount of the dividend takes them over the income max for that mo. & you likely will have to do a specialized form to have it amoritized evenly by 12.


ASSETS: All assets are counted, unless the assets fall within the short list of "noncountable" exempt assets:
- personal possessions,
- a vehicle (some states have a limit on the value)
- a principal residence, provided it is in the same state in which the individual is applying & the house may be kept with no equity limit if the "community spouse" lives there; otherwise the equity limit is about 500K (750K in some states)
- prepaid funeral & burial (irrevocable, NCV, usually 10K max)
- small term life insurance (usually $1,500 & NCV)
All other assets must “spend down” to states max to qualify and have to be done so that they are in compliance of the 5 year look back.

My mom's review was 3 years and 6 months of financials and the application was slightly over 100 pages - mainly due to her old-school style life insurance policies which are very legal size lengthy. Took about 6 months to be approved and I dealt with a transfer penalty issue and she had a medical appeal done (medical is done within the NH and by their staff not family).

The financials are what most folks focus on. But remember that they also need to medically qualify for skilled care for Medicaid. Good luck and keep a sense of humor and patience!
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I think you mean Medicaid. Medicare is provide to all over 65 with premium deducted via FICA when working or your SS when retired.

Go on your state's site to see what the specific amount is as it can vary for income. Medicaid has different programs. If this is Medicaid for NH, Medicaid NH rules set by each state & are state specific even though is a joint federal & state program. Qualification BOTH financial & medical & needs-based. You are fully expected to spend down your assets first & foremost before the state will pay. There are things that can be done with assets in advance but imho need to be done by someone qualified who understands your state’s Medicaid. Usually a certified elder law attorney.

For NH Medicaid eligibility, an individual must show that:
1) are 65+ (can be younger if qualified disability),
2) medical condition requires skilled level of nursing care,
3) monthly income at or below their states max (varies, about 2K),
This is the “income test”– how much $ do you make.
4) all countable assets are at or below 2K (higher if community spouse). This is the “asset test” – how much $ do you own. Assets are savings, IRA, stocks, insurance, real estate, etc. You have to spend-down to get to the 2K.
5) have not gifted away anything of value during look-back.

If you do, could be a “transfer penalty” for gifting. Penalty based on each state’s NH daily reimbursement rate. For example in Texas $ 142.92. So Blue Book value car of 10K = 70 days penalty in TX, in which you have to private pay NH although they are accepted in Medicaid.

Financial look-back is 5 yrs. Most states require 3 – 6 mo. of all financials, plus property ownership documents with initial application. For car or home, that is current tax assessor statement. You sign off for state’s ability to access any & all records and acknowledge MERP (estate recovery). State can require add’l documentation within a strict time-frame if something pique’s interest, like paperwork to establish if insurance is term or whole life.
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