How will Medicaid assess a healthy spouse's inherited resources, to be split among 3 siblings over the next 2-3 years?

Medicaid is pretty exacting in what it expects income & assets to be in order for one to be eligible. It is in my experience, it is not medicaid who has loopholes but family who is hoping to find loopholes. And to do that you need to have experienced elder law attorney based in the state of the elder to guide them and their DPOA to possible options. If they are at the point where they are in a facility, family is very limited in what can be done creatively. The state can require prior 5 years documentation on all possible assets and income sources. State can & will issue a transfer penalty if $ was moved about outside of medicaid rules.

For an individual NH medicaid, it's 2k in non exempt assets and about 2k in monthly income (exact amt depends on your state as each state administers its program uniquely). They have to be "at need" financially which means impoverished. For couples, the NH spouse needs to be impoverished BUT the community spouse is allowed up to 114K in assets and their assets are fixed ( often called the snapshot day) on where they were financially on the date of the application. If the CS is realistically right behind the NH spouse in needing that level of care themselves, they are just going to have to spend down to get to the 3K asset allowed for couples.

No matter how you look at the math, your elders have $. They are not impoverished and will need to spend down to qualify.

Yours have significant assets and assets that are easily findable as their names & SS # are tied to assets. 150K mutual funds alone.....they are not impoverished. State expects them to use their $ to pay for care first & foremost. By applying to Medicaid, they sign off on state getting an all-access pass to IRS, tax assessor, banking, investments, retirement sources,etc. An all access pass & nobody gets a tour T-shirt, or a lanyard to get into the after concert backstage party.

Are you saying that the home is rented and that the rent is being given to the 3 kids (& future heirs)? If the property owners are on Medicaid, what happens with the rental income are under Medicaid rules. There is a poster on this site who has their moms house rented - hopefully she can provide insight on this.

Also house will be subject to " intent to file a claim or lien" process by MERP after the last one dies. Try to clearly speak with attorney as to how MERP is done for your parents state and what state requires for non resident executors.

Joannes, This should be Federal Guidelines. each person individually who qualified for Medicaid would have to spend assets. Your second sentance conflicts " ALL needs to be spent down before Medicaid pays for even one of them. My Mom could have the $114,000 plus house and one vehicle in her name after Dad qualified."
Perhaps Mom won't ever need Medicaid and she will be able to meet her care needs with the money she has left plus the Life Insurance from your Dad.
The Purpose of Medicaid is to care for people who have no resources to care for themselves, not to preserve family money to pass it on to the next generation.

I'm not totally sure I understand all your details, but it sounds like your mom & dad's combined estate is worth 240k plus 150 plus another 25k (or 250k?) . Total 415k? (Or, is it total 640k? Not sure if one of your k's was meant to be a zero....). At 415k, if both spouse go to SNF, it will need to be spent down to 3,000. This would take several years. After they reach 3,000 joint assets then Medicaid kicks in. Assets in a Trust are usually countable assets for Medicaid purposes. There will likely be nothing left for heirs, unless both spouses expire soon. And even if they both expire soon, Medicaid does not disburse what is left--they only come into play at probate court if there are unpaid bills. Consult with a Medicaid - experienced elder attorney (not just an Elder attorney,, a Medicaid-experienced, and tax-experienced, attorney, and perhaps they have an accounting firm working with them to crunch the numbers ). There are some general knowledge books out there to give you a rough idea (Gabriel Heiser's " Medicaid Secrets") but for personalized info, you need a Medicaid - experienced attorney.

The type of Trust that was made 10 yrs ago, makes a difference in how it might be counted as an asset by Medicaid. Revocable Trusts are countable. And in some states even Irrevocable are counted. Miller & others....I hope someone else (like Gabriel Heiser who sometimes answers questions here) offers some clarification. I am not an expert, you need to talk with one about your particular situ.

You must consult with a Medicaid Planning Attorney. Laws can vary from state to state. If the inheritence is in the name of the Non Nursing Home Spouse they are not countable for Medicaid. Only Joint or individual assets for the institutionalized person count for Medicaid eligibility in the state I live in.

They should simply look at the spouse who is going to SNF's funds. I can not see how this has an effect on the other siblings. It is not their debt. The siblings should each get their share and the one going into a SNF will have to hand over their share to pay the bill. Am I missing something here?

Have the parents passed and the estate is being distributed?

As I read this again, I think palmtrees1 is correct...this is about the parents being gone, estate going to heirs but one of the heirs now has to go to SNF.

And for ladylee1115, I did not say it clearly....there was a big spend down of almost all assets to get my Dad qualified. Mom left with house and 1 car and the limit of $114.000 in assets, however, not that much left... she is now home with private caregivers, so her remaining cash will only last about 5 months now with her at home. We have an RV to sell and then the house or car. So no, she's not likely to have her assets last the rest of her life. She will be looking at AL real soon, and she's refusing to consider that. She wants to die in her home. But with caregivers getting about $3000/mo and being down to less than $10000 in cash IF we cash in the IRA and Annuity.... it's all going to go fast. I was not suggesting that I should get an inheritance while gov't paid for their care....just lamenting the fact that in the beginning, I had the option of 'taking a salary' for all that I do, and I said, " Well why should I do that to my parents' never figuring on what a mess it would be, how much time it would take and how my home business would be destroyed in the 3 years since I took this on.... while all the inheritance that my parents planned to leave me, would be used up and when it's done, hubby and I will have nothing but social security for the rest of our lives, if our business has lost so much it's not able to be sold to anyone. Just lamenting how life turns out and how easy it is to be screwed no matter that you try to do the right thing! I am having a really bad time right now is all. I'll likely be better tomorrow.

Houseplant, you need an attorney as well as an accountant. I am neither, but the little that I do know, has me questioning these items, in no particular order---"The Trust and not Mom is "owner" of the house"-- Medicaid in some states overrules Trusts (these assets could still be considered countable), that would be something an attorney could answer, for your state. I am going to put in multiple dashes to separate things (I can't get the paragraphs to work on this forum).
----"Some money needs to be saved to take care of the rental house"----Medicaid doesn't care one iota that the heirs may want to rent out the house, it views it as an asset; if your mom's name is on it (again it varies from state to state about the Trust) then it might be a countable asset.
----"it seems this heir's spouse may be penalized"----Medicaid doesn't care one iota about the family split or anybody feeling that someone is "penalized" they just want the MERP to move along and get the state's money back.
----"The well spouse's money will hopefully be viewed as seperate ownership"---if the well spouse receives $50,000 that will be counted as part of their approx. $114,000 Community Spouse asset allowance. And if Executor wants to try and "preserve" the 1/3 inheritance, somehow, and Medicaid caught a whiff of what was happening.....again here you need the advice of an attorney; perhaps someone else of the 3 kids is going to need Medicaid? You can't keep going down the road of "we wanna inherit" eventually, any assets anybody has, PLUS anything they might inherit, are to be used for their care.
----Conclusion-----you need to seek expert advice from an attorney who knows your state's Medicaid inside out & backwards. Don't be so anxious about your situation, there are many many millions of people who have NOTHING. Be happy that your family apparently has something, and USE some of your assets to figure out this complex situation and if possible, "protect" it. Quit thinking that someone is getting "punished", be pro-active, and "PROTECT" it. Put your energy into a good solution---with a good attorney (not just ANY attorney, make sure they know Medicaid in your state....not all do!).

When someone dies with outstanding debt, their debt must be settled before money is passed on to their heirs. Once this has been done, each heir will receive their share according to the will or however it is set up. Then if one of the heirs has to go into a SLF (or their spouse) it is up to that heir to cover their cost. If the heir places the inheritance into an account free of the spouse, the heir may not be liable for the cost of the nursing facility for the spouse. This is not commingled funds. However, I would check with a lawyer on this one. I am not positive about this but I do know you can inherit money and as long as it is not commingled with your spouse, the spouse has no rights to that money.

However, see an attorney.