The treatment of the home residence under the Medicaid rules can be somewhat confusing.\u00a0 Here is a brief rundown of the some of the major points to understand.<\/p>\n
So long as the property (\u201cHome\u201d) is used as the principal residence by the individual who applies for Medicaid benefits (\u201cApplicant\u201d) and\/or the Applicant\u2019s spouse, the Home will not be a \u201ccountable asset.\u201d\u00a0 This means its value will not be counted towards the maximum amount of assets the Applicant is allowed to keep.\u00a0 However, if the equity in the home is worth more than $814,000 for Medicaid applications submitted on or after January 1, 2014, then the excess is counted and may present a problem.<\/p>\n
When the Applicant is single and a resident in a nursing home, however, and the Applicant is objectively considered to be in the nursing home merely on a short-term rehabilitative basis, then the Home is still considered the Applicant\u2019s principal residence and it need not be sold.\u00a0 On the other hand, once the Applicant is considered to be a nursing home resident on a permanent basis, then the Home is no longer the Applicant\u2019s permanent residence and under the Medicaid rules the Home must be sold and the State must be reimbursed for any amounts it has paid for care.<\/p>\n
Apart from the issue of whether or not the Home is countable as an asset, there is also the issue of whether or not a transfer of the Home during Medicaid\u2019s five year look back period will result in the assessment of a transfer penalty.\u00a0 If the Applicant \u00a0(or their spouse, or their agent under a power of attorney) conveyed the Home to anyone else within five years of filing a Medicaid application and the Applicant did not receive full fair market value in return, then under the Medicaid rules, that transfer was a gift that will be penalized.\u00a0 The \u201ctransfer penalty\u201d is a period of time during which Medicaid benefits will not be paid, even though the Applicant is otherwise eligible to receive benefits.<\/p>\n
Under the Medicaid rules there are a number of exceptions to the rules that will permit the Home to be transferred without penalty.\u00a0 The Applicant and\/or the Applicant\u2019s spouse may transfer the primary residence immediately and without penalty to his or her spouse, or to a child under age 21, or to a child of any age if the child is blind or disabled under the applicable rules.\u00a0 The rules also permit a transfer to a sibling, if the sibling has an equity interest in the Home and was residing in the Home for at least one year before the Medicaid applicant was institutionalized.<\/p>\n
Finally, there is an exception that permits a transfer to a child who (1) was residing in the Home for at least two years immediately before the date the applicant is institutionalized, and (2) who provided care to the Applicant which avoided the need of institutionalizing the Applicant during those two years.\u00a0 That particular rule is sometimes referred to as the \u201ccaretaker exception\u201d to the transfer penalty rules.\u00a0 Depending on the family circumstances, the caretaker exception can be a valuable way for the family to protect the home from the devastating costs of long term care.\u00a0 However, it can be difficult to adequately demonstrate that the care provided by the child is the thing that kept the Applicant out of a nursing home during that two year time period.\u00a0 We encourage all our clients to keep careful records of the tasks that the caretaker child performs, and we also consult as needed with the client\u2019s medical providers, to present a clear and compelling case for applying the caretaker exception in appropriate circumstances.<\/p>\n
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The treatment of the home residence under the Medicaid rules can be somewhat confusing.\u00a0 Here is a brief rundown of the some of the major points to understand. So long […]<\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[1],"tags":[],"class_list":["post-2719","post","type-post","status-publish","format-standard","hentry","category-uncategorized"],"yoast_head":"\n