How does selling the primary residence affect Medicaid assistance?

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My father in-law is living in an assisted living facility in Missouri. Recently was approved to receive partial assistance for his living expenses. He also receives SSI, retirement, and veterans benefits. His checking account is below $1000. He owns a home in Illinois that is for sale. He still has a small mortgage payment that is difficult to pay because his expenses and bank account situation. We now have a buyer that is interested in the house. When we sell the house and he get the proceeds from the sale, what is he allowed to do with this money and how does this affect his Medicaid?

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Ellis

Is where she is at handicapped accessible?
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Ellis - so who is your neighbors DPOA? Who in her family is named as the future executor of her estate as per a valid will? I'd be concerned that you as a "neighbor" involved in her financial decision is exposing yourself to risk by APS if family feels she was influenced by you.....no matter how good your intentions are.
Her property is worth 6 figures.....too much $$ & family is going to surface. If there is no family, then I'd suggest you & her schedule an appointment with an elder law atty to do the paperwork for you to become MPOA, DPOA and do whatever else paperwork needed and have the atty explain how Medicaid works. I'd help her by doing a listing of all her debt and bills due and current tax assssor starement along with a "face sheet" on her n advance of atty meeting. Face sheet should details all marriages, kids from, status on former spouse and her immediate family (siblings). There is gonna be a lineal heir out here somewhere...

She currently qualifies as her home is an exempt asset. If she sells it, the $ from the sale becomes income the month received and then becomes an asset and either will take her over Medcaid $ limits. She can reinvest to buy another home but it sound like with her history of falls her living on her own well that is just a clusterF waiting to happen. Yeah she could buy an annuity but unless it's a medicaid compliant annuity, it will make her ineligible. Non- compliant Annuities for those elderly & infirm are a bad Idea as they are going to need the $ and will take a huge hit to cash it in - the insurance guy who sold it will make a tidy commission on the annuity btw.

Really she has the ability by selling her home to live in an independent living place and pay for aides if she is adament on not going into AL. What I have found is for most elderly what their view of what a AL / NH is based on what they were in the 1950's - 1970's & along the lines of a mental institution. Lots of fear and imagining moving into a snake-pit. If they never themselves have had close friends move into IL or AL and visit them, they don't know how terrific they can be.
Good luck in this but be careful not to place yourself at risk.
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I am helping an elderly neighbor who owns her home free and clear worth around $200,000. Her only income is $900 per month social security. She has ms and is disabled but can still live alone unassisted. She frequently falls and spends time in the hospital for treatment from her injuries. The majority of her medical and medication expense is covered by medicare/medicaid. She is drowning financially and gets a little deeper in debt (credit card) each month. Her living expenses exceed her income and she can't even afford homeowners insurance. She would like to sell her home which is much larger than she needs and purchase a smaller condo for around $100,000. This would leave about 100K in cash left over. She does not want to go into an assisted living facility.
What options are available so as not to be disqualified from receiving medicaid benefits? Is there a time period in which she has to purchase another primary residence while remaining on medicaid. Is an annuity an option. If not ???? Help please!
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Yes there is some principal owed on tge house but he will still net $50,000 or so.
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Geeorge, you asked if your father-in-law can gift some of the equity from that house to his children.... the answer is "no".... if he should do that, then Medicaid will use the amounts "gifted" and subtract it from what Medicaid would pay to help. Then Dad would be responsible to pay out of pocket.
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There is still a money owed on the house?
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Anther question, can he gift some of the proceeds to his children
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He must spend the proceeds on his own health needs.

Since he does not live independently, he has no need for a car (which he would be allowed to buy for use own use). So, he will spend it on the ALF monthly payments until he is back down below $2,000. Then Medicaid will pick up again.
If Medicaid continues to pay after the house is sold....beware...Medicaid will be coming to that money, make sure it is available when they do.
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