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She has never had a full time job and they have supported her for 25 years now. My brother and I have tried discussing this with my parents but they just think we are ganging up on her. If something happens to either one of my parents, the financial burden will be put on my brother and I. We are at a loss as what we can do. Any suggestions will be greatly appreciated.

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Is it possible to have a college degree and also have physical/psychological problems that prevent working full time. Some things that might cause this (without necessarily being obvious to a casual observer) include bipolar disorder, chronic fatigue syndrome, depressive disorders, and fibromyalgia. (No doubt there is a long list of other conditions.)

Have you discussed with your parents why they are showing such favoritism? Are they giving her money to supplement what she is able to earn in order to help her achieve "the good life" that you and your brother have the health to achieve on your own? Are they trying to even things up so all of their children have equal chances at a good life? Without hearing their side of it, it is difficult to get a real feel for this situation.
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How do you know your parents are giving your sister money? Do they discuss it with you and your brother? If so, then that's a good time to discuss how they are simply "enabling" your sister to be a taker. However, perhaps they want your sister to be depedent on them for some reason.

You might ask your parents if they love your sister more then you and your brother because that's exactly what it looks like if they give her money that doesn't have to be worked for, but they don't do the same for you and your brother. Let them know that it hurts you whenever you see them giving giving giving to your sister and not to you and your brother, regardless of whether you need it or not. In supporting your sister, if she is not physically or mentally incompetent, they are clearly playing favorites.

And in some states, if they ever need a nursing home and any medicaid funds are used, they could come after you for reimbursement of those funds.
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You are not required to "take up the slack" if they run out of money.

Your parents can spend their money as they choose.

Since they have been doing this for 25 years, Medicaid may not regard it as a ploy to use up their funds to become eligible for Medicaid. I don't know about that, but that is the reason behind the "no large gifts" rule.

Sister works part time. How large are these gifts that "support" her?

If you want help convincing your parents that their financial behavior may become a problem for them if one of them needs care, you could consult an attorney specializing in Elder Law for specific advice about the possible consequences. You would have to pay for this consultation. Would a written report from a lawyer be more impressive to them than the advice of you and your brother?
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Yes, you will pay the nursing home bills, but only if you choose to. Like giving whisky to a drunk.
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My sister has a degree and is very capable of working. She has chosen to convince my parents that she wants to live "the good life" but at my parents expense. My brother and I will be the ones to take up the slack if something happens to them.
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If they are certifiably incompetent, you may pursue Guardianship.
If they are mentally competent, they can do whatever they want, but you need to make it clear to them that Medicaid won't pay when the money has all been gifted away. Reassure them that none of you will rescue them from their own foolishness. Let them think about it.
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Your parents can do what they want with their money. You and your brother have no responsibility to support your sister should anything happen to your parents. Perhaps your parents have set their estate to take care of her.

I know it sounds harsh but it is the life she has chosen. If there is a reason your sister cannot work then she needs to look at whatever services/funds are available in her area.
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