My mother, 98, has been living with me and my husband for 6 years. She still has a small sum of money left from selling her condo. Her burial is pre-paid years ago, she has no life insurance or stocks/mutual funds, only CD's. I do not plan to move her into assisted living as we have good care for her at home - the best place for her to be. She is remarkably well in many respects but is non-ambulatory, hearing and visually impaired. Can I spend down her money to purchase living room furniture so that she is comfortable. We have very old, inadequate furniture that she doesn't find comfortable, so she only sits in her room where she has her lift chair. Also, am I able to gift her grand-daughter the maximum amount? I'm over-whelmed by the looming Medicaid.
Gifting the granddaughter would probably create a penalty situation with Medicaid.
Her money can be spent on anything for her, but not on gifts. Is she paying for the in-home care you have hired? That she can certainly pay for. I think the furniture is a little less clear. If she were in her own home furniture would be fine.
I hope someone else can clarify the furniture question.
Medicaid is limited to the very poor. The income and asset limits are at about 2K for each, so if mom has CD or proceeds from the sale of her home still in her bank account, all that would have to be spent down on her care or her personal needs to the 2K/2K limits. Each state sets their exact amount, my mom is in TX and it's $ 2,094.00 for income and 2K for assets. Some states have these lower.
About the gifting to granddaughter, personally I'd wait and not to be callous about this, but @ 98 every day she is beating the odds and the probability is that can't stay that way for too much longer. But what you could do is have her bank account be POD in the granddaughter's name as the POD. That way when she dies, the account goes completely to granddaughter and byspasses probate. If her burial is all prepaid and she has no property, there is no real need for $.
About the chair, I'd ask her MD for a prescription for another lift chair and then find a place that has a chair you like and an accompanied table, order it and pay for it from her assets. Let the MD know it's private pay, he'll probably write it up as "patients choice" so you can pick what you want and works for her. When I was doing the spend-down for my mom, I got her a tricked out Hugo walkers, extra glasses, hearing aids, etc as once she got on Medicaid these would either not be covered or what Medicaid allows is the absolutely cheapest ones. Good luck.
In this situation, since the length of time Medicaid would be applicable would be relatively short, I'm not sure that spending down and applying for Medicaid makes more sense than just spending the money on the items needed for in-home care. But in general you don't need to go into NH to benefit from Medicaid.
Hilkay - OK I have some experience in dealing with a NH related Medicaid transfer penalty. But no idea if it is the same for Medicaid for at-home services in how they require documentation.
For NH this is how it worked for my mom who is in a NH (just slightly younger than your mom) and on Medicaid. The NH gave me a 1 page list of items required for her Medicaid for NH application (let me know if you want me to do a post on that), my MIL - also in TX - got a 2 page requirement. So there is no set list - nothing but FUN there. In my mom's list of required stuff was the last 6 months of all bank statements and also a notarized letter required from every bank regarding any and all bank accounts closed out in the last 3 years. For us, it was OK as I had years ago consolidated her accounts to a single community based bank and as my mom's CD's expired then went into her main drawing account. If an account had had a withdrawal of over 5K that was not deposited into her account, I would have had to provide documentation as to what for - but we didn't so skated on that one. Now my mom had been in IL on private pay before NH so where her $ was going was pretty obvious also she still owed her home so again where her money was going was obvious.So there was an easy pattern to follow both for the NH in accepting her "Medicaid Pending" and later for the state Medicaid caseworker. All in all, she got a 3 year 6 month review of bank stuff.
Transfer penalty from gifting seems to be triggered either by the state's dovetailing of property records during the application review process or by withdrawals of significance in looking at their bank statements. Each state seems to do this differently, as I said nothing but FUN. If say in March, 2010, they had 85K in their account and today, March, 2013 have $ 2K and live with family then it is going to pique the caseworkers interest and you will have to provide documentation that makes sense that all that $ was spent on her needs or her care. It doesn't have to be logical stuff either - it can be a face-lift or a trip on the QE2 just a well as expensive dental work or new shoes - it just has to be their $ on or for them. Otherwise they will be declined for Medicaid until you can provide documentation that they can put in their file.
For my mom, her car was a transfer penalty question. and was just inside the 5 year review period. It came up about month 4 of her being in the NH. How the transfer penalty works is that the rate is based on whatever your state has set as it's Medicaid daily reinbursement rate for the NH. For Texas, it's about $ 143.00 per day transfer penalty as the state pays a NH $ 143.00 a day for room & board under Medicaid. So in TX, a car valued at 20K is about a 140 day transfer penalty in which although the elder is qualified for Medicaid they are ineligible for Medicaid payment. Yes, you kinda have to read that last sentence twice as it's tricky. Understand? Now each state has their own formula in how the transfer penalty is done and will make the IRS rules look simple. Now a transfer penalty can be appealed, that's what I did, and the appeal was set like 4 months down the road. That is a super long time to get your paperwork together if need be, BUT the critical part was that the appeal filing window is short (well at least it was for us for TX) and as long as there is an appeal in the system they are on Medicaid. For us this last part was critical as the NH would have loved to bill us for private pay but they couldn't as long as there was an appeal in the works. I was able to deal the the transfer penalty in about 2 weeks as it was the wrong Kelly BLue book value as the year & model were wrong and then a letter from her mechanic as to the condition of the vehicle along with several cancelled checks on work they had done to validate that the value was way below what they thought. Car was gifted to worthless nephew too so he was of no help. Faxed it all over to caseworker and she was approved the next day. Champagne all around.
You are not alone, I am of the firm belief that if they live long enough that they will eventually run out of $$. My mom has outlived all siblings, husbands, and many of nieces and nephews. She is the Energizer Bunny of Dementia as she has Lewy Body Dementia and shuffles when she "walks" scooting her walker. Too funny.
But I digress, the gift to the granddaughter will be hard to get around. But the 13K to you, well I'd look into figuring out a way to justify it for room & board costs. Good luck and keep a sense of humor.