Can I provide financial assistance to Mom on Medicaid?

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My mom may soon be entering a program that is paid for by Medicaid. It would allow her to stay in her apartment but get comprehensive medical care as her dementia progresses. It seems ideal for her current circumstances, as she is in early stages of dementia.

She makes a bit more than allowed on Medicaid, so she will have to be on a "spend down" that would require her to pay about $400 per month for the program.

Here is the problem: she has run up do much credit card debt that after paying for her apartment, meal plan (dinner only), telephone, and minimum credit card payments she will have only about $90 left per month to pay for breakfast and lunch and sundries. That won't be enough. I and my brother would like to supplement that with one or two hundred a month, but would that count as additional income that Medicaid would just take? How do we handle this?

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Take all the credit cards away. Write to each lender to cancel the account and inform them she is on Medicaid. One of you should be POA to do that. Do NOT pay her debts, Medicaid will want to know where the money came from. You might even want to take her checkbook away to protect her from her own spending habits. Get her foodstamps or go to food pantries nearby.
There is no harm in bringing groceries or sundries as a gift, or even a coat and winter boots, but do not give her cash.
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Realistically once they go onto Medicaid, there will be no $ to pay for CC debt. At this point in time why not just stop paying the CC debt? Mom isn't going to buy a car or a house or need a good credit report anymore now is she? If she has limited funds, wouldn't it be better off to use her limited resources to pay whatever co-pays or out of pocket medical costs may come up than a CC that likely will never be paid off?

If mom defaults on the CC, how short would she be on being able to pay for her other monthly costs?

Now if she does this, you want to do a couple of things in advance of all this: if she is getting the CC bills at her apt, they need to go to a new address so you can start to deal with the paperwork that will come about from defaulting. Like rent a box at a local UPS store or a shipping service (these tend to be around colleges or universities) and then do a change of address to all of mom's mail. Really once they start on the dementia decline, having all of her mail going to a set place where she cannot lose or overlook it will make things more manageable for you all. You can have it sent to your address but you don't want the debt collectors to start hounding you at your address or confusing her debt as yours now.

If she is still short of $, I would look into that instead of you all giving her a check each month (income) to instead you directly pay for the expense. So the phone bill is in your name and you pay it (actually is could be good as she would have a new phone # which the CC doesn't know to hound her at). Perhaps you directly pay part of her meal plan too.

If in the future, mom gets to the point of needing a higher level of care and needs to go into a NH, Medicaid requires a co-pay or their "SOC"(share of cost) of all their monthly income less a small ($ 35 - 90) personal needs allowance. At that point there will truly not be a penny to ever pay their CC debt. So kinda keep that in mind in all this. It may be better to just get it all done & defaulted on now. If mom needs to do bankruptcy, she needs to be competent enough to go to court. I bet she still can do this now, but if you delay this for a while she may not be able to do that. She can still default but it will be messier to deal with…. I know your quandary as my MIL was a real financial terrorist and we had all sorts of debt issues to deal with. The debt collectors are relentless. Good luck.
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