My mom and I bought a house together a long time ago. About 5 years ago, we took her name off the deed, but had to put it on again when she applied for Medicaid because of the 5 year rule. I lived with her all that time helping take care of her, would have the 2 year caregiver rule trumped the 5 year rule?

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Didn't you do a division of assets when she went on Medicaid? Look those papers over carefully, see what amount was assigned--- usually half the house. So you get to stay there after death, but ONLY if you have proven that you were in fact assisting with ADL's like bathing, feeding, dressing, toileting and medications.
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Help - In my experience what you kinda need to keep in mind is that qualifying for Medicaid is different than what MERP / Medicaid Estate Recovery Program is. What I'd suggest is for you to clearly ask in writing to your mom's Medicaid caseworker, how your state manages the caregiver exemption currently. Some states will allow it to be done upon the application with documentation (this is often called "companionization") if so, I'd do it asap. But other states have it so that it is filed upon the death of Medicaid recipient and done within your states MERP and probate process, this is going to be more of a challenge. Whichever is the case, if mom is on Medicaid, there should have been some sort of "acknowledgement of participation in MERP" statement in her application; whether she or you sign it or not, doesn't matter either as by taking Medicaid means she & her assets & her heirs are subject to however your state does estate recovery.

Many states are turning MERP over to outside contractors & their approach is very document driven with strict timelines. They are very much in debt collector mode. Like for TX, once the "Letter of Intent" is sent out by HMS, you have to respond with details within 60 days. The form is pretty detailed and you have to list info on assets, on all heirs; provide for a copy of the will, etc. For TX, the caregiver exemption requires a detailed letter from the elder's physician or social worker who will certify that they saw the elder for the 2 year period prior to entering a NH and that certain caregiving was needed and provided for by you AND you have to show that you were able to be a full-time caregiver during the 2 year period. Often the elder lives in the NH for a few years before they die, and then when you need to get the letter the old MD won't write it as it has been too long. If you had a job during the 2 years, you won't qualify for the exemption and they can ask for your taxes & W-2 for that period of time. It's pretty demanding on documentation. You may want to get the letter now. If you ignore the letter, then a claim or lien can be placed on the property by default for the full amount Medicaid paid and with interest - just as a side note there are several posts on this site from family who either ignored the letter or were unaware and now find that a lien has been placed on the property - this is a very difficult situtation to get around as the claim has to be released in order to transfer or sell the property so you have to settle with MERP. Often they could have qualified for an exemption but since they did nothing MERP places a claim or leon.

If your state runs it so that the caregiver exemption is done after death, imho you have to be pro-active on all this now and for the rest of mom's life and through the probate process. You need to keep all receipts on every penny spent on the house. Everything from taxes paid to light bulbs bought to yard work paid for. Once mom goes onto Medicaid, she will have no - none - nada -ziltch of her $ to pay for anything house anymore. You need to document & to the penny what was spent by you to cover her 50% as you are going to need this to file your own claim against the estate. It is going to add up. What you paid towards her 50% should be able to be an exclusion to the Medicaid tally - this you need to make sure of as to state law but most states do this for MERP. Some states allow for only taxes, insurance costs to be exclusions; other states allow for other costs as well. Some states allow for all reasonable expenses on empty homes. MERP is required by law to show that pursuit of the property is cost effective; a low value home with significant expenses paid may not be worth going after. Providing all the details with receipts, letters, documentation, cancelled checks, etc. all falls to you to do; if you don't then MERP will file a claim or place a lien. It is in their best interest to make you pay if they are outside contractors doing MERP as they get a % of the recovery (about 12% - 18%).

Just out of curiosity, for the 5 yr, just how many months was mom at for being out of compliance? Depending on the value of the home, it might have been better to have dealt with the transfer penalty and then never have to think about MERP in the future. But since you did it, your probably going to have to ride this all out.

One thing that comes up over & over on the keeping momma's home issue, is that you have to be able to afford the costs on the home 100% on your own for however long is the rest of mom's life and through the probate process. If you've needed mom's income to make house costs, this is going to be difficult. Really take a hard look at the costs on the home and your income. Good luck.
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