I was told that if my mother does a LOAN to me - her son - that she could not be denied Medicaid. Why?

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I would payback at the rate of the loan.

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Team, if your mother has $26K available to pay tuition, she's well beyond needing Medicaid.

It's not designed for people with significant assets; it's to help out needy people with extremely limited assets, although some more wealthy folks hire attorneys to restructure their portfolios so that their parents eventually can get Medicaid, drawing down on the funds available for people who are truly in need.
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MEDICAID is for people who have no more than $2000. in assets and under $2000 per month in income. In other words, it's for folks who are POOR.

Your mom CAN'T give money away in order to qualify for Medicaid.
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Thanks so much for the information...Right along that same line...Lets say my mother would like to just pay for my daughters 26,000 tuition bill - no loan, she just want to pay for it...Can they come after those funds as well?
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Igloo, I've never heard of a SCIN. This is a new one on me. It's amazing what the wealthy can do to protect their assets. And I worked for attorneys who handled estates of the wealthy, but perhaps not the 1%, just ordinary wealthy!
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My understanding is loans to be valid would need to be legally drawn up, witnessed and notarized promissory note or memo of understanding that is actuarially sound (takes into consideration mortality tables). Actuarially sound means using tables so that the terms make sense.... like 90 yr old can’t lend on a 20yr as it’s more than their anticipated lifespan. And the borrower has to carry out the terms. I’d bet that Medicaid looks at these with a jaded eye & it will be placed in application hell. And for more fun, the NH may not accept the elder as “Medicaid Pending” so it’s private pay by family (as elder has to be impoverished to apply) till they clear the Medicaid application process and become eligible. Application can take months. My moms took almost 6 mos; there’s folks on this site whose parents application took 10 months. 

But I do wonder if perhaps this is an estate atty, then they are telling you about a SCIN - a self cancelling installment note. SCIN were / are used for gen skip of assets by the real wealthy. It’s not a traditional loan. Usual scenario is fully owed inherited property (like Aunt Mildred’s place in Water Mill, NY) is “sold” via the SCIN to a grandchild or more likely a grandchild’s Trust. The generational skip is needed to make #’s work. If Tia Mildred dies before note paid off, the note cancels and not a part of Mildred’s taxable estate. SCINs are complex & part of a well thought out estate plan done in coordination by estate & LL.M atty, FAs, CPAs.... definitely not ever a DIY.  I don’t see someone applying for Medicaid doing these. It’s a top 10%er thing imo.

The atty, are they NAELA? If not, you may want to get a second opinion from a NAELA elder law atty as to whether the “loan” can pass Medicaid review for how your state administers. 
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No, it doesn't. I'm not sure what the "same rate it was borrowed at" means. The interest rate would be stated in any promissory note, and that would be the rate at which it's paid back. OTOH, perhaps the attorney meant that you had to repay the funds at the rate designated in the Note or other document - that makes sense. Maybe it was just his way of explaining the interest issue.

However, I don't understand "not the whole amount.". You would pay back the principal, plus interest, which together would be more than you borrowed.

If you borrowed, say $5K, at4% interest, you would pay the $5K plus 4% interest for whatever period of time specified in the Note, and at least at the monthly rate specified.

And that total amount of interest increases the total payback amount. Payment could be over several years, depending on the amount and the terms of the Note. Does that make sense?
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What do you mean " at the same rate, not the whole amount"?

If your mother gifts you any money, there will be a Medicaid penalty.
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It was an elder care lawyer. To elaborate. I was told that I would have to pay the funds, but at the same rate at which it was borrowed at. Not the whole amount. If that sounds right.
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Teamweasel, just curious who "told you" that if your Mom gives you a loan that it wouldn't affect her getting Medicaid. Was it Medicaid who said this?
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