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Remember vehicle registration is recorded by the State & that data is scrubbed & distributed to all agencies including TX DADS (dept that does Medicaid) so it will come up eventually. My experience with TX Medicaid, is they are very through on vetting the application and you need to provide as much of the info requested initially to make it work smoothly. You want to xerox all the bank statements from the last year, all pages of any insurance/burial/funeral. If any bank accounts were closed or transferred within the last 3 years, you want to go to the bank and have them do a letter detailing where that $ went: like certificate of deposit account 123 deposited into primary bank account 456 OR account 789 closed with cashier's check made out to XYZ for home repairs. Don't try to be cute & leave stuff out.
The sale of the car needs to be close to whatever the Kelly blue book value is - so if it's 3,800 then it needs to sell for within 10-20% of that. If you sell it for $ 1.00 to worthless nephew, she will still face a transfer penalty based on the BBook value and gotten screwed and the only one who wins is worthless nephew. I think it's the same thing if she donates it to a charity too.
The transfer penalty is the $ amount & period of time an otherwise qualified Medicaid NH resident will not qualify for Medicaid to pay for the nursing home
AND the NH will have to be paid by $ from the sale, if the money was spent on other stuff the family will have to pony up and private pay. Remember Medicaid, even though it is a federal program, is administered by each state according to the states unique rule of law on property rights, etc. So each state has it's own rules on the transfer penalty % and how they figure the average for NH cost.
In general, it works like this: mom has her 100,000 home, goes into NH, after 2 years family is over dealing with the home so they sell it. Now the state's NH AVERAGE monthly cost is $ 5K, so 5 by 100 is 20. So that means for 20 months, Medicaid will NOT pay for her care as the $ from the sale of the home is to be used to pay for her care.
My suggestion is, IF you can, sell the car BEFORE you do the application and use the 3K to get her things she will need. You can buy a funeral and burial policy, life insurance (small, term, irrevocable NCV). Glasses, dental care (spotty on Medicaid), hearing aids, walkers. If she has a home, prepay for utilities, cable, insurance, repairs. No $ gifted to others. Everything must be for their care or their property. Medicaid look back is 5 years. The state can go thru 5 years of bank records & also require receipts to any item that pique’s their interest. 3K isn't that much money, one good series of dental visits and it's spent. If you sell it after she is in the NH then you really have no control on what you spend it on as it must go to the NH first. So selling before is better.
Remember to have the plates removed, as in accordance with Texas Department of Transportation policy.
If that was the case, then what the Medicaid person may have told your SIL is that Medicaid allows for the "community spouse" to have resources that they can spend without impacting your mom's Medicaid. The exact amount of resources ( resources is not the same as income - which is Social security or whatever else they get each month) depends on each state but is usually about $ 109,000. But some states have this a lot lower.
In general, when there is a couple the 1 in the NH can have about 2K in resources
(like savings) and then 2K in income and be OK for Medicaid BUT the still living in the community spouse does not have to themselves become impoverished in order for the other to go into the NH. That is what the 109K allows them. Usually it is a older spouse who has a second and much younger spouse, who need this. So when he was alive, the SIL might have been transferring his "resource $", which they could do but would be an issue if he applied for Medicaid within 5 years of the transfer.
But if the "in the community" spouse dies, then it can be a problem for the NH spouse as they inherit the others $ (if the account was joint or involve community property), insurance policy, etc and then have too many resources to stay on Medicaid. So was there a will and who was the beneficiary and are you all in a community property state? At a minimum, your mom should have the 2K allowed as resources for her to keep. Your SIL may not realize this or perhaps she does........I'd speak with the social worker at the NH and have them ask the assigned Medicaid caseworker for the NH to contact you. Most states have it such, that you have to contact the state to let them know of a change in status. I'd do this sooner than later, so that if SIL has to return the $$ it is done soon without getting legal involved. Now if you think that SIL is just not a nice person, then start looking for an attorney. Often the state will send a letter to them asking about distribution of proceeds and probate status on the deceased estate and that alone will make the $ surface. You know your family best. Good luck.
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