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My mother is in a nursing home. We are private pay at the moment. We will soon be spending down to get her qualified for Medicaid. The only things she owns is her home and it is not very valuable. Her household goods are not valuable either. Her grandchildren could use some of the furniture and dishes. Can we let them have them or would this be considered as transferring funds? She will probably be eligible for Medicaid in about 6 months. She will not have any money left to pay taxes on the house, but we can pay that rather than sell it. When she dies, Medicaid will probably take it, but we don't want to sell it now because we would just have to spend it down anyway. We are just wondering if we can give the contents of the house to the kids. The stuff is just sitting there ruining.

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Joanne656 - you may want to have a tag sale with an ad in the paper and use the $ to pay towards any future property costs. No reason why family cannot "shop" ahead of the public and buy what they want. That house is going to have costs to maintain till it gets sold & your in a NH mom in maybe 6 mos when she goes onto Medicaid will NOT have any $ (like her SS) to pay on property cost as Medicaid requires her to do a copay (also called the SOC share of cost in Medicaid-speak). Mom can use her $ to pay property costs right now as shes private pay but once on Medicaid she cannot unless she /DPOA do the paperwork to do a partial waiver of SOC simultaneously with her NH Medicaid application. Waivers vary by state, like TX allows for waiver to pay for mortgage or heloc (I'd bet because these are secured) but not to pay utilities / maintenance and the waiver needs a MLS Realtor listing agreement on the house & is time limited.

That tag sale $ could come in very handy unless you & your siblings have the $ to pay all moms property costs for however long it takes to sell house. Taxes, utilities, insurance, etc. It will add up. And be able to pay without any assurance of getting reinbursed. Unless your mom has done some sort of promissory note or property agreement before now, that $ family spends on house if reinbursed from the proceeds of the act of sale will more than likely be viewed as gifting by medicaid. It will stall her application as it will cause a transfer penalty inquiry.

Personally it's my view that for the "maw's house & Medicaid" scenario, either family is planning on keeping it (paying the whatevers) from now till beyond death & deal with probate or other non-probatable estate asset transfer months or years from now; OR house gets sold ASAP to as close to FMV possible and it gets done BEFORE ever doing moms Medicaid application. As to why on the latter, well once the house gets sold, it will take mom over the 2k asset max allowed for medicaid..... So she becomes ineligible....goes back to private pay....then has to spend down (again) & reapply for medicaid. That sale is recorded to the penny and if it's not there in her bank account to the penny, it's Hello! Medicaid Transfer penalty inquiry. Really Medicaid tends to look at any $ spent by family on mom or her property as done out of a sense of love & familial duty without repayment or reinbursement.

Transfer penalty is basically a math equation. Each state manages its Medicaid program uniquely and determines what the daily Room&Board reimbursement will be. Avg is about $ 180. That's the denominator. The $ transferred is the numerator. There's a couple of other factors but that's the basics. Say moms state pays $200 a day R&B; sells home for 100k; BUT BIL gets 15k for repairs to house he did & Sissy gets 9k for taxes & inspection & new water heater. That 24k would place a 133 day transfer penalty on mom. Even though mom is now in a NH and has spent down her $ and qualifies for Medicaid, she is ineligible for medicaid to pay for 133 days due to transfer penalty. It can be appealed but unless there's a promissory note or other binding agreement already done when mom was still competent & you get a elder law atty. to shepherd the inquiry, the state is going to want to view the $ as gifting. It's the DPOA who is going to have to deal with this mess. Btw the appeals process, like the estate recovery system, has pretty precise time frames on submissions. If you don't get on it within the appeals or submission window, your toast. Appeals can be successfully done but imho the DPOA better be very, very almost OCD organized type and a bit of a pit-bully to get things done. If bro just won't kick back the 15k placed as penalty or get you the info needed to do appeal, it will not be pretty at the next family gathering.

Really my suggestion is get house sold asap at FMV. And before ever applying for medicaid. If house has significant issues and flat will not sell at FMV, get it appraised so you have the documentation to show why it sold under FMV. Get a Realtor who has a track record of DOM (days on market) under 90 days in the area where hous located. This is kinda not the time to let your neice handle the listing unless she is a killer Realtor. Ditto on doing it FSBO.

Good luck, try not to get too too overwhelmed & if your the DPOA make family realize the Medicaid process has no real grey areas or wiggle room.
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I am glad I am not the only one who has those feelings. You can sell the house but Medicaid expects market value. I got a lawyer, his fee can be taken out of Mom's money, Medicaid excepts that. My plan is if husband goes before me, I sell the house and get an apartment. Then all my girls have to worry about is cleaning it out.
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They put you in the position where you hope they die before you have to deal with all of this stuff. Really sad, but that seems to be the only solution. ☹️ We have already thought of all the problems with the insurance and taxes and maintenance. Also, it's impossible to know five years in advance that you may have to go to a nursing home. Any of us could have a stroke and have to go tomorrow.
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I was also told, if I maintain the property i better keep immaculate records if I expect to get it back and even then maybe not. It comes down to, when ur Mom passes, Medicaid will ask for payment based on Mom still owning a house. The house will need to be sold to cover the lean or u can pay and keep the house. Me, the house is not selling. Mom is in spend down so I can't use any of her money unless for her care. I have chosen not to pay taxes so either the Township gets the house vor in the end, Medicaid.
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Good advice from both of you. Probably do need legal advice. It doesn't concern us because she hasn't given anything away, but in reading about the penalty period, I don't understand it at all. A person goes into the nursing home and spends down all their assets. Then they look back and see that you gave something away. Then when the person has no money, you have a penalty period. Where are they supposed to get money to pay it. I guess their family will have to, but what if they don't have family? Donthey put the. Out on the street. Don't anyone bother to answer this. Just want to vent.
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I cleaned my Moms house over a period of time before filing for Medicaid. We got a guy that all he wanted to know is if the house was up for sale, which it is. My Mom has nothing of value. My SIL took what she wanted. My nephew lived with Mom and is still in the house. We put stuff aside for when he moves on his own. Alot of stuff was thrown out. As long as she doesn't have antques, don't see a problem. You do realize that once on Medicaid ur Mom pays nothing towards the house. So, if you want to keep it utilities will have to maintained unless ur in awarm state and u don't have to worry about frozen pipes. Also, insurance companies don't cover empty houses or they charge a horrible amount. I had to show Moms house was for sale. If you rent it, thats income for her and the rent is based on Hud guidelines.
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If you rent it out, remember that counts as income to the owner and could put her over the top for Medicaid income requirements.
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Why not sell the house now? If it is a rental it would provide mom some source of income that would help towards her nursing home Bill. Yes, medicaid will lace a lien on it to recover funds spent for mom's care.
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I would consult with an attorney who is very familiar with Medicaid laws, so you are sure you are making the right decisions. You may also get some good tips here, but, since, it's such an important issue, I'd get proper legal advice about it.

Also, it's my understanding that her money has to be spent on her and not taxes. However, you might check with her county's tax dept. Some places have reduced or even waive property taxes for the disabled, if you have a doctor's letter confirming it.

It's my understanding that there may be a lien placed on property, but, I don't think they actually sell the property. Maybe, someone who knows more will chime in.
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