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Medicaid, Protection of Assets

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ehlhjh123

Junior Member
What is the name of your state ? Colorado

Hi,
I'd be very grateful to hear any advice around my situation w/ my grandparents Medicaid.

I have a legal question regarding what a "primary residence" is. If my mom buys my grandma's home (no mortgage), and my grandma buys my mom's home (no mortgage), but my grandma continues to stay in that home, and my mom continues to stay in the home my grandma buys, would their new "primary residence" be the home they just purchased?

All the bills going to the house will be to the owner of the house, and no money will be paid between my mom and my grandma except for maybe $50/month for differences in the electricity, etc.

--If this scenerio works, I believe my grandma will qualify for Medicaid w/out having to spend down ~$250k of her savings, and it allows her to live in the house that is close to my grandpa's nursing home.

Any comments would be greatly appreciated!

EWhat is the name of your state?
 


BlondiePB

Senior Member
What is the name of your state ? Colorado

Hi,
I'd be very grateful to hear any advice around my situation w/ my grandparents Medicaid.

I have a legal question regarding what a "primary residence" is. If my mom buys my grandma's home (no mortgage), and my grandma buys my mom's home (no mortgage), but my grandma continues to stay in that home, and my mom continues to stay in the home my grandma buys, would their new "primary residence" be the home they just purchased?

All the bills going to the house will be to the owner of the house, and no money will be paid between my mom and my grandma except for maybe $50/month for differences in the electricity, etc.

--If this scenerio works, I believe my grandma will qualify for Medicaid w/out having to spend down ~$250k of her savings, and it allows her to live in the house that is close to my grandpa's nursing home.

Any comments would be greatly appreciated!

EWhat is the name of your state?
This is a legal advice site, NOT illegal advice. Spending down is fraud, a crime.

Your grandmother has a quarter of million in cash, a house and who knows what else of value and y'all want to live off the taxpayers!! Oh, brother...:rolleyes:
 

ehlhjh123

Junior Member
Not fraud...

What I'm proposing is not fraud though... My grandma falls into the "Utah Gap", and therefore falls into a category of people that would only be able to support nursing home costs for one spouse for a short period of time w/ existing savings and income.

Depending on how long my grandpa lives in the nursing home, her entire savings may be drained before she herself needs that money.

To postpone her need to use her savings she needs to find a LEGAL way to allocate her savings so that she can get my grandpa on MedicAid to preserve her own future.

Thanks for your helpful response though...

e
 

moburkes

Senior Member
What I'm proposing is not fraud though... My grandma falls into the "Utah Gap", and therefore falls into a category of people that would only be able to support nursing home costs for one spouse for a short period of time w/ existing savings and income.

Depending on how long my grandpa lives in the nursing home, her entire savings may be drained before she herself needs that money.

To postpone her need to use her savings she needs to find a LEGAL way to allocate her savings so that she can get my grandpa on MedicAid to preserve her own future.

Thanks for your helpful response though...

e
And, again, why would Medicaid pay for his nursing home costs when he has $250k+ in assets?
edited to add: Why not spend the money to keep grandfather in the nursing home, then put grandmother on Medicaid later?
 
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tranquility

Senior Member
I know next to nothing about elder care as it applies to Medicare and Medicade eligibility. I know even less about this area of the law in CO. However, we have many well-off older clients who see good attorneys who do practice in this area. Smart guys who are trained, experienced and attend classes on this all the time and who go to bed each night pulling their binkie up to their chin with a final thought, "How can I get someone with assets qualified for Medicaid?" Anything they come up with they talk about with their friends and co-workers the next day. This is repeated for years.

No one I know has come up with what you propose and advised our clients to do so.

Take that for what you will. Trading houses on paper with a reletive does not seem to be that difficult to figure out. That those who know about such things don't do that makes me think there is something wrong with it. Rarely do people come up with a new financial trick without a superior knowledge of the law. I'm not going to try to analyze why it won't work, I merely say that I wouldn't try or advise it.
 

ellencee

Senior Member
What is the name of your state ? Colorado

Hi,
I'd be very grateful to hear any advice around my situation w/ my grandparents Medicaid.

I have a legal question regarding what a "primary residence" is. If my mom buys my grandma's home (no mortgage), and my grandma buys my mom's home (no mortgage), but my grandma continues to stay in that home, and my mom continues to stay in the home my grandma buys, would their new "primary residence" be the home they just purchased?

All the bills going to the house will be to the owner of the house, and no money will be paid between my mom and my grandma except for maybe $50/month for differences in the electricity, etc.

--If this scenerio works, I believe my grandma will qualify for Medicaid w/out having to spend down ~$250k of her savings, and it allows her to live in the house that is close to my grandpa's nursing home.

Any comments would be greatly appreciated!

EWhat is the name of your state?
Grandma can protect some of her assets but certainly not all of her assets.

Medicaid is going to review all financial transactions for the three years preceding an application for benefits. Any attempt to hide assets or to deceive the Medicaid program will result in denial of benefits.

An elder law attorney or an estate attorney can help grandma to gift family members with some of her money and property and to do so each year. She can prepay her funeral costs and granddad's funeral costs and purchase burial plots for each of them.

Above and beyond those actions, grandma will be paying for nursing home expenses or home care expenses if she is kept in her own home.

As for your question of residence, residence means where one lives. If she sells her house but lives in it, then it is her residence regardless of who owns it. If she buys property but does not live in it, there is no 'protection' for that property.

If grandma sells any of her assets for less than the actual worth/value, Medicaid will hold her responsible for spending the difference on her own healthcare before Medicaid will pay. So, if she does as you have proposed by swapping a home of greater value for one of lesser value, grandma not only loses part of her net worth but loses again when she is held accountable for the amount she gave away in order to qualify for Medicaid. Poor grandma loses all the way around, which means the heirs lose, too.

EC
 
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BlondiePB

Senior Member
What I'm proposing is not fraud though... My grandma falls into the "Utah Gap", and therefore falls into a category of people that would only be able to support nursing home costs for one spouse for a short period of time w/ existing savings and income.

Depending on how long my grandpa lives in the nursing home, her entire savings may be drained before she herself needs that money.

To postpone her need to use her savings she needs to find a LEGAL way to allocate her savings so that she can get my grandpa on MedicAid to preserve her own future.

Thanks for your helpful response though...

e
To postpone her need to use her savings she needs to find a LEGAL way to allocate her savings so that she can get my grandpa on MedicAid to preserve her own future.
Due to grandpa ALREADY being in a nursing home and NOT being on Medicaid because he is NOT eligible, you ARE looking for a way to commit fraud. Had grandpa NOT been in a nursing home, that would be an entirely different story. As EC, suggested, having gram & gramps pre-paying their funerals is an legitimate expense.

As for the gifting, Medicaid applications do ask about that too. Y'all are playing "cheat the system" and looking for a way for taxpayers to pick up their medical tab when they have plenty of assests.

If grandpa is a Veteran, he may LEGALLY qualify for benefits for nursing home care. When he passes, then grandma may LEGALLY qualify for his Veteran's benefits for nursing home care and even Assisted Living.
 

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