Where can a veteran's spouse put her money (in excess of $80,000) so she can qualify for Aide and Attendance?

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My mother in law has been living on $1500 month for the last 12 years, prior to that the income was a bit higher because her husband (veteran) was alive. They never knew about VA pension so never applied for it. She is starting to need care at home, we have been spending money we don't really have on fixing her house up so she can remain in there as long as possible. She complains about the cost of her pills, hearing aids, teeth etc. etc. and I understand why. I have looked at what was out there for assistance and came across VA assistance. I reviewed her income with her and found out that a portion of the $1500 monthly income is interest on money that she has in the bank. When her father died she inherited his property and sold it ... she has in excess of $80,000. My suggestion was to start using that money for the home care she needs. The way I see it, the government is going to get it anyways. Then she would qualify for Medicaid later I believe. She won't though, it is like a psychological security blanket for her. Is there a place where she could put those funds so that they are still available to her but they are not deemed an asset? That way she maintains her security (in her mind), she gets the care she needs and she gets to leave something to her kids (her goal). With the look back period I don't like the idea of her giving it to her kids now because if she ends up needing a nursing home I know which kid will end up paying for her care until she would qualify. If she doesn't get help ie VA, I know she won't dip into her savings, then we are going to feel negligent if we don't help her but, we don't really have the means either. It may sound like we are trying to take advantage of a program but we are just trying to find a solution to her care that would sit well with her and that wouldn't involve our bank account. thanks

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Thanks for all of the feedback, greatly appreciated.
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This is so very common in parents of your mom's generation - they were raised with the mentality of setting money aside to leave behind when they are gone. Guess what? Times have changed!! My mother won't listen to me on advice, but when my husband tells her something it's like God himself is speaking to her and she follows his advice (it drives me CRAZY, but hey - it works!) Is there anyone available with that "power" to talk to your mom about this? That's all I can suggest - others have already given you good info. good luck!
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First of all, you got great advice here. I wanted to add that even with 80k she still might qualify for the A&A, my Mom did. I know a place you can find out if she will qualify before you even apply if you need that info. I went to a lawyer and he suggested a caregivers contract and I got paid from moms money weekly, this is a legal way to spend down the money. Most went for daycare, other caregivers, heat, furniture, her diaper supplies, etc. I paid 30% taxes on my portion and its already been used for Mom again as she is living with me and her money isnt enough, I need breaks and hire people when I can also. Moms money ran out years ago. This was never about getting paid, it was about two things, one, because the siblings wouldnt help and they would reep the benefits of her inheritence if she died without helping Mom one bit. The second reason was for a spend down so Mom could qualify for medicaid. Although, now that my Mom gets the A&A she is about $50+ over the limit and cannot get medicaid, which is fine, she lives with me anyway and I think medicaid is mostly used for a nursing home, which I wont ever need. Please remember that if you are the DPOA and you give your Moms money to the siblings you are breaking the law and will be held liable. Your siblings are not beneficiaries unless your mother has deceased and named them as so. My siblings wanted me to give them their share and the laywer told me its illegal to do that. Old age is what her money is for, for her, now, to live a wonderful life to the end and not to save for anyone. We spoil my Mom with everything we can including a new 10" memory foam mattress we just bought for her hospital bed, etc.. She deserves the best. Althought my Dad wanted us to have an inheritence, he loved my Mom more than anything and she came first. He would have never wanted us to put her in a nursing home so we could have an inheritence. Please get to a lawyer and make the right decisions and record every dime of her money spent with receipts, its a long and hard process but you will need it for the A&A and Taxes and the Courts when your Mom passes.
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Get an attorney who specialises in elder law. check into a Millers Trust and see if that will not help. The" look back" law is your obstacle. Not to give legal advise but perhaps looking to future needs, transfer the 80K into a trust under your name or another reliable relatives name. Unless the law changes, and 5 years pass, the 80K doesnt exist as far as the feds are concerned. Anyway you look at it, some one is going to pay taxes unless it is done right. We had a similar situation with my mother-in-law some year ago and as I recall a Millers trust was a desirable option, allowing her to go on medicad and spend down her money without penalities. Best check with an attorney.
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I have to agree with jeannegibbs...but don't feel lonely in this situation. I have any more than one family ask me about this same question, for primarily the same reasons you have given. Momlover is right, there are options, but be aware there are certain time constraints for most of them. You can consider putting the money in a trust, but if she requires assistance within 5 yrs (I believe this is still correct even with the changes from the Affordable Care Act) of creating the trust, that money will be counted as income. I just assisted someone in going through the process of applying for placement in the VA (her mother has Alzheimer's). You can also cut down on some of the Rx expenses by registering her with the VA and ordering her Rx through Express Script. Check to see if she also qualifies for a free pair of eye glasses each year through the VA as a dependent. Even with the money, there may be several ways for you to cut costs for her care. I wish you the best of luck.
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I paid for an elder law attorney (out-of my aunt's money) to find how to deal with her home sale $. To many options to discuss here, but I can confirm that there are reasons why that is your best move. You will only know once you consult them. Please do. Unfortunately, I waited past the 30 day grace period from the date of sale to take advantage of some options; but it was still worth the visit.
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Show her a monthly bill for a nursing home. Than say that she has a choice. Either ending up giving her money to the nursing home OR spend it on her health in order to stay in her own home and spend to keep the home up.
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Ditto to what jeannegibbs said! Focus your efforts on finding a way to 'spin' this in a way that will make your MIL feel better about it. Because, by hoarding this nest egg, she is ensuring that it will all go to the government if she should need Medicaid to pay for nursing care (as jeannegibbs points out, $80K runs down pretty quickly at $8K or more a month). HER money should be used to do repairs and improvements to her home, pre-pay her funeral expenses (right down to the flowers), visiting an elder law attorney, etc...
It's harsh, and easier said than done, but you can refuse to ante up any of your own money for these things.
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That money is her security for her old age. Guess what? She's old. :) It is time for her to start using that money for things she needs and not burden her children with paying for things she could be paying for herself. Her behavior is selfish though I am sure she doesn't see it that way. She is wanting to have that money available in case she needs it in the future, so her kids won't have to step in and pay for things. But the future is now, dear Mother.

I think you should use a little of that money to consult an attorney who specializes in Elder Law. He or she can come up with ways to set things up that will be psychologically satisfying to her, will position her most favorably in case she ever does need to apply for Medicaid, and make sure she can pay for her own needs for as long as possible.

If her health holds up, $80,000 is a nice cushion for things like hearing aids and glasses and fixing up the house. If she needs a care center, $80,000 is a drop in the bucket and she will need Medicaid.

Once upon a time $80,000 was a nice legacy to pass on to one's children. Alas. People live longer now and often develop expensive conditions and diseases. This is very, very sad for folks like your mother who have been living modestly thinking they were saving money to pass on to their children. The likelihood of all the savings (or any of it) being available to pass on is small. Sad.

But sad or not, it doesn't make sense for you to be paying for your mother's expenses so that she can save her assets to give them to you in a will. I don't know if there are siblings involved, but all of you need to stop enabling your mother in her unrealistic expectations.

See an Elder Law attorney.
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