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Mom is in so-so health, still lives at home with assistance from me and from home health care. Owns home free and clear, and has considerable financial savings. She wants to begin giving some of the money to me to invest for myself, but I'm wondering how Medicaid will view this if she ends up having to go to a nursing home at some point.

Is there some sort of threshold for how much money is allowed to be gifted away? For example, if she gave me $500 a month, would they scrutinize it? Or are they looking for huge dollar amounts?

With regard to the house, it's multifamily and I live in one of the units in exchange for upkeep and paying some utilitii. I had heard that it may be exempt from Medicaid if I've cared for her for the past two years. But, I'm unclear on how they define caring for her... I'm certainly not a doctor or nurse, nor is she legally my dependent. I do drive her around, pick up groceries/medicine and help out around the house in miscellaneous ways.

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Unfortunately, there is no minimum amount that can be gifted to avoid the Medicaid penalty. All gifts made within the five-year period immediately prior to the date your mother applies for Medicaid are added together to figure out her penalty period. The penalty is equal to the total amount gifted divided by your state's average monthly nursing home cost (set by each state annually); that figure is the number of months that Medicaid will not pay for your mother's care (i.e., the penalty period).

The two-year rule you refer to requires that you provide such care for your mother that BUT FOR SUCH CARE she would have needed to move into a nursing home, and such care is provided for at least the two-year period immediately preceding the date your mother eventually enters a nursing home. If you can document that, then your mother can then transfer the home to you without it causing a Medicaid penalty. You should be sure to get a physician's statement to back this up. You must live in the same unit as your mother, not just in a different unit in the same multi-family dwelling.

Others have suggested you have an attorney draw up a Personal Care Agreement, which will permit your mother to transfer money to you in exchange for your care for her. That's a good idea; but remember that those amounts she pays you must be reported as taxable income, on your income tax return.
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If your mother has "considerable financial savings," then why would she need Medicaid to pay for her care? Medicaid is for impoverished people, not for people who've hidden their assets. Beware. If you do go through with trying to transfer the money, you should not do it on your own with advice from the internet. Plenty of people try this and plenty get caught. So, if you hide the money, don't spend it because in all likelihood, you'll have to have it on hand to pay for Mom's care when Medicaid won't. Another option you could consider, if you're looking to preserve your inheritance, is to care for her yourself. Don't ask the government for a handout and they'll stay out of your business. You can keep every penny.
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I've wondered too about the question of how an elder spends his or her own money and then applies for Medicaid when the money runs out. It doesn't seem right for someone to spend lavishly at the casino or go on a cruise around the world when he should be saving for possible long-term care needs in old age. I agree it seems a little unfair, because any one of us could drop dead tomorrow, and the person might want to enjoy his money while he can. But if people are going to ask others to pay for their care when they run out of money it seems reasonable that they should live frugally and do what they can to make their resources last as long as possible. What do others think? Does Medicaid look at how frugally or how lavishly the senior lived prior to application for assistance? And how far back should Medicaid look? I mean, if a 45-year-old took a round-the-world cruise would that be considered extravagant when the individual is probably decades away from needing Medicaid anyway? I'd like to hear from others on this.
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Yeah, it is a little unfair. Life is a lot unfair, as I suspect you've noticed.

If a 45-year-old goes on an extremely expensive cruise and then at age 49 becomes disabled and needs to apply for Medicaid, the cruise will not have any impact on the application. She spent the money on herself, which is allowed. You might say it is unfair that she gets to apply for taxpayer assistance after spending so lavishly. She might say it is unfair that she got this disabling condition that she never expected and did nothing to cause or deserve.

"Fair" and "unfair" don't seem to have much to do with health issues.
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sirpsychosexy, are you asking if it is possible to lie and not get caught? I suppose so. Not everyone who cheats on their income taxes gets caught either, I suppose. I still wouldn't recommend it.
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This question is an insult to society! You want to spend your Mom's money, and
then ask your tax paying neighbors to pick up the tab for her future care. People like you live in a dream world of easy entitlement. The government has no money. They only spend ours. So pay your own way, and forget cheating the rest of us!
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There is no threshold from Medicaid on gifting or transferring $.However gifting will trigger a transfer penalty. Medicaid is a needs-based program and as such they are limited to about 2K in "income" and about 2K in non-exempt "assets". The exact amounts are set by each state as the states administer Medicaid under a general federal guideline.

If mom has considerable savings, take part of that and get all her documents together (bank statements, info on marriages, birth and deaths) and go see an elder care attorney so that you can do this right and within compliance of your state laws and approach to Medicaid. They will present options. Some of them will likely involve a financial advisor. If you think they will need Medicaid, you just need to make sure whatever you do will be Medicaid compliant.

There is a HUGE difference in between gifting $$ and transferring $$ when it comes to the elderly. Anyone can gift $$ - this is an IRS and tax issue.
But for Medicaid, $$ transferred (gifted) by an elder to another and not specifically for their care or their needs with proper documentation done (like the personal care agreement Jeanne suggested), can trigger a transfer penalty under Medicaid. Transfer penalty inquiry can be very detailed and the state usually has the upper hand as they have the documents that show a transfer in the first place. Medicaid can do a full 5 year review. So if mom when into a NH today and applied for Medicaid, that would mean you must provide whatever her state wants back to 2008; or forward to 2018. Either way that is a looooooong time.

About the house, what you are talking about is MERP - Medicaid Estate Recovery (or Recoup) Program. All states that take Medicaid $$ must have a MERP program in place. There are exemptions on MERP for family who are full-time caregivers, cost of maintenance on empty homesteads; heirs who are themselves on another state program for the at-need; etc. Google your state's program.

BUT I think you are going to have a much bigger issue with the property. It sounds like this is an income producing property and a multi-unit? My answer is based on this. An elder's homesteaded property is an exempt asset under Medicaid rules. They can keep it forever (in most states) as an exempt asset for Medicaid. BUT there will be NO income from them to pay for anything on the house (like taxes, insurance, etc) as all their income must be paid to the NH as their Medicaid co-pay. They get a small personal needs allowance ($35 - 90 a months) which seem to be placed in a trust for that @ the NH. This pays for the beauty shop or their cable or phone costs. If momma has a house, she can keep the house and if it is empty and not income producing, then it is an exempt asset and family will need to pay for everything on the house. Then when momma dies, whomever paid for house stuff has to let MERP know within 30 -90 days that they are filing a claim or lein for these expenses and provide specific documentation of all expenses. MERP removes these costs from their tally. MERP has to decide whether to do a claim or lein on the property and if there are exemptions. If you do nothing, MERP places a claim or a lien on the property. This has to be released in order for the property to be sold or transferred legally. This is kinda how it runs when there is a traditional homesteaded property (free-standing house). BUT if this is a multi-unit, it is an income producing property. Income producing property - like rental houses or raw land that can be sold - are assets and they are usually not exempt for Medicaid. The state will require they be sold in order for the elder to go onto Medicaid. The fact that you are living there, not paying rent, etc, make it such that you are getting a benefit below fair market value. Others are paying rent, you are not. Yeah I know you are doing stuff for her and this is compenation, but the state doesn't care about that, unless you have a legal agreement whatever you do for mom is viewed a done for love and familial duty with no compensation. This is all going to get very sticky. Get an experienced attorney to sort all this out & do it now while mom is still competent & cognitive to make these decisions.
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Sirp - Medicaid is needs-based and the state has the ability to require years and years of documentation to accompany the Medicaid application.

Isn't easy is spot-on about this.

Some state have contracted out compliance and MERP to outside firms. If your state has done that, then you will be stuck in paperwork hell and likely have a significant transfer penalty and perhaps even fraud issues and never get a MERP release on the property till it all is cleared. None of this should be taken lightly if you are planning to play games with reporting assets and income. And it is NOT just do the initial Medicaid application and then no worries. I have to do an annual re-certification on my mom's Medicaid application and there are specific ? regarding her home - like homestead exemption details, status on property, income producing, ownership change or future change (like a life estate done). All of this signed off on by me as her representative with a clear paragraph on fraud & penalty for nondisclosure, yet another MERP acknowledgement and then added this year another form specifically on the details on the status of her home. Oh and for even more fun, all due 13 days from the date on the letter. I always get it either the day after it's due or on the due date too. I know it's coming so I have the documents together and fax them asap. But my point is Medicaid compliance is constant and ongoing for the rest of their life on Medicaid.

You do realize that the income producing multi-unit property will always be an issue as the state can and will place a claim or a lein on the property as a part of the compliance required in order for her to get Medicaid? This isn't the state being mean but they have to do this in order to get federal funding for Medicaid. The claim or lein will show up if you ever go to sell the property too and can queer any sale. You have to disclose it also on the Realtor form as to the status on items on the property, just like you have to disclose if there was ever a flood claim or foundation issues you are aware of. If you don't and the buyer has to wait to close, they can sue you for the costs lost due to this or even worse get this and out of the deal and all their earnest $ back. You will have to get a release from MERP in order for the property to get a clear title in order for a warranty deed to be done.
Banks and mortgage companies require this before any money is lent too. There is no easy sure way to get around the Medicaid requirements nor should there be. If there was then everybody would spend every penny of Momma's $ on themselves and not her; put her in a NH on the state tit and within short time there would be no state support of NH for those who are at-need as the system would collapse.
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Wow, it's always amazing how there will be an idiot or two in every cyber-crowd, thinking that they know someone and jumping to conclusions based upon a few paragraphs on a discussion board.

My mother is all about saving money and investing it, and WANTS to give a certain amount to me to invest for the future. She has worked her entire life to save it, and she's not about to check into a nursing home, but wants to do this for me with HER money.
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The penalty rules are designed to avoid precisely what you are trying to do. Your mom is blessed to have your support and company, she is also blessed to have savings and income producing propoerty. I assume your parents worked for that and paid their taxes, thereby contributing to society.

You are blessed to not have to go out of pocket to care for your parents, and if you are living rent free, you are doubly blessed. Helping mom is not something you should get a financial reward for. This is not something taxpayers need to support.

Medicare is for the elderly, Medicaid is for the poor. Moving assets to make her eligible is wrong, unethical and may not be legal. DO Not lie in any of the forms!

If I sound opinionated, this hits close to home. My father went through a long time illness, my mother and I paid out of pocket for everything he needed and he wanted. $4600 ramp, $2500 mattress (towards the end he was very uncomfortable in bed, and I was desperate to help him), months of live in help for my mom and dad, 24 hour nursing care in the last few months. When the end neared, dad wanted to leave the hospital, he was going into hospice but the doctor did not want to let him leave because it was obvious my 80 Year old mom could not care for him, and I did not live with them. The doctor was refusing to sign the release, he wanted to move him to the hospice unit, dad wanted to go home. I had to provide a written statement that I was paying out of pocket for his care, Hospice was only going to provide 24 x 7 care at the very end. Trust me end of life expenses can be very high.

The last 3 years of my dads life I spent a lot of time and money on him. I would not take back a penny nor a second. When I took his keys away I provided a weekly Sunday dinner and casino outing an something to look forward to. I took him on vacations. I visited him almost everyday, ran errands Saturday morning, personally changed him and stayed up many nights with him. All while carrying a heavy workload and not wanting to abandon a relationship with a great man.

Please rethink moving your mom's assets and remember they are for her care. Government provided care is a last resort and is never as good as privately paid care. Medicaid NH can be pretty nasty. Being able to live at home is more desirable for many and if your mom has assets, her quality of life is why they should be spent on. Do not work yourself to death as she needs more care, get help, so you can stay strong and remain kind towards her. While others can help you physically care for her only you can provide her mom-daughter moments of happiness, These will be truly priceless.


Bottom line, the taxpayers should not have to pay for the care of a person with assets, and your mom will have a better quality of life with private services than with Medicare provided services.

When your mother passes, you and the others he specifies can worry about the assets. You children will have a beautiful example if family support seeing how you cared for your mother.

Sorry if my words seem tough.

Bless You,
L
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