You better understand that Medicaid may take all of your inheritance

[egbertowillies]

Did you know that if your parent or anyone affording you an inheritance after they die were on Medicaid at any time, the state may have the right to take it away? I read the following article in my local newspaper this week.

https://egbertowillies.com/2017/05/13/medicaid-may-take-inheritance/

[Canoe52]

1. Yes, that is why you need a secondary insurance plan when you are on Medicare.

[CousinIT]

9. But Medicare is different than Medicaid

Medicare is the over 65 healthcare we all get. Medicaid is for the very poor (who don't necessarily have to be over 65 to get it).

[Canoe52]

35. Original poster referred to older people (dead parents)

If you have Medicare ( only pays 80%) without a secondary, then have a major illness and end up pennyless, you go on Medicaid.

Tip to the wise, get a secondary insurance when you start Medicare.

[CousinIT]

36. You mean a supplemental that covers what Medicare doesn't?

Honestly asking. I'm not quite there yet but dreading it when it happens ie: having to get insurance after retirement. Of course Medicare may not even exist by then.

[Tanuki]

38. No, the OP refers to Medicaid, which unlike Medicare covers nursing home costs

for indigent seniors. People with assets above a certain threshold do not qualify for this, so some families transfer the parents' assets to the children so the elderly parent will be "poor enough" to qualify. States have varying look-back periods and will come after assets that were transferred within a given period of time (e.g., 3 years) prior to enrolling in Medicaid.

[NewRedDawn]

60. After taking out over $100 a month

in premiums. That is pretty difficult to do pay additional premiums like in my mother's case only gets $1344 monthly to live off.

[enough]

11. Medicare does not cover long-term care, either in or out of a nursing home.

The only insurance that will help with this is long-term care insurance outside of Medicare. Even that will usually not come close to actually covering the cost.

[Zoonart]

51. Correct...

My mother-in-law's long term care insurance only
covers one third of ehr nursing home expenses and caps out.

[pnwmom]

43. Secondary insurance in Medicare doesn't help you with nursing home bills paid by Medicaid.

That is for people with no substantial assets.

[leftofcool]

2. This is the way it has always been.

[WePurrsevere]

6. Yes, it's been this way for as long as I can remember but...

It's amazing how many people don't know it or to get a lawyer who can help.

[bettyellen]

3. Ummmm, this is nothing new.

[csziggy]

4. No one I know who is Medicaid has anything to leave their children

The couple I know the best has never had anything. Every extra penny they have ever had in their lives was eaten up by medical bills. Most of the jobs they have had were minimum wage ones because they could never stick with a job long enough to be promoted beyond the starter pay. Most of their health costs above whatever minimal insurance they have ever had has been written off by the doctors and hospitals who have saved their lives. All they had to do was to check the couple's credit history to find they own nothing of value and never will.

[DURHAM D]

7. Usually real estate is involved in the take back.

I have a cousin living in his parents home. His father was on medicaid/medicare and died about 10 years ago. His mother is in a memory unit and is on medicaid/medicare. I tried to talk with him about the lien on the house but he does not believe me so I just dropped it.

[NewRedDawn]

8. If Trumpkill gets passed it will even be much worse!

Now you can get an estate planner Attorney who gives the parents life time use of the home & puts the home in childrens name. When time ever comes to go to a home.Medicaid will pay for care without touching the property. With Trumpkill with the cuts in Medicaid, this will probably end & the children will be on the docket to pay or do the care themselves with no Govt. help.

[northoftheborder]

15. I think any transfer of property has to be three years before death or it is included in...

what the Gov. can take to pay for nursing home care.

[Bayard]

23. Yes, that happened to my sister

If she'd put it in my nephew's name 3 years previous, they couldn't have done it.

They made my parents do a "spend down". They could only have $3K in the bank.

[Hortensis]

33. Government "couldn't have done it." It cost your family that

she didn't use this dodge, and let's face it this is normal in our society. After cleaning herself out paying medical bills, my MIL (a frugal lifetime saver) put her last few thousand in trusts for our children and then filed for Medicaid. I'd do it myself.

But at least let's not pretend our government (OUR as in We the People) is doing something wrong by expecting us to pay our own way as much as we can. After all, if that means we are required to spend money caring for ourselves that we would have liked to leave to our children, oh well.

[pnwmom]

44. That is 5 years now and few people do it. nt

[shanti]

49. that's what my mother did

she put her home and bank accounts in her kids' names more than 3 years ago, so we're ok. now she has dementia and she's past making decisions like that anymore. she's aging in place at home, her choice, and my brother stays with her. (thanks, mom, and happy mother's day!)

[politicat]

57. The look back is 5 years from the start of Medicaid eligibility in most states.

That was our experience with my mother's father. He and my step-grandmother had sold one farm and bought a few acres with one house existing and space for a second house, which they added. Then they subdivided the property and gave the existing house to my mother's step-sister. When he got his Parkinson's diagnosis, they transferred other property. He live about 4 years after diagnosis, the last year in skilled nursing. They didn't have the income to pay for it, so he was on Medicaid. My step-aunt (who is a piece of work, but was the one on site, so deserved the hazard pay) had owned the property long enough that she got to keep it. (My mother got cash out of the original farm sale.) The rest was within the look-back, so the state of Indiana attached it and the other heirs had to either cough up the lien or let it be sold. The only exception was the second house, which my step-grandmother inherited as surviving widow, and which was attached for her final illness.

The big issue with the Medicaid look-back is that most elderly people have assets after a lifetime of work, but don't have much income. Most of that asset is usually their family home or farm or both, much of which they inherited themselves. It hits working and middle class people hardest, and is what gets conflated as "death taxes" amongst people who aren't policy wonks. Because Medicare only covers up to 120 days of in-patient rehabilitation, and Skilled Nursing runs around $7000 a month, even in rural Indiana, it's very easy for a family to run through a lifetime's savings very quickly.

[csziggy]

10. The couple I know lives in the cheapest rentals they can find

Often they are afraid to report any problems to the landlord since some of the properties should have been condemned. Most of the places have been so bad students won't rent them - usually 40-50 year old mobile homes with the floors rotting out, bad windows, no air conditioning, etc. The last one was two miles past where the city buses go so after each of them had a stroke and the wife congestive heart failure, it was difficult since neither could walk to the bus. My husband drove them everywhere.

Last year my husband helped them move into the best housing they have had in thirty years - half of a duplex on a very busy through street. The first week they lived there, my husband brought them to our house to take showers since there was no hot water in the unit. It is actually a real building, not a trailer, with brick siding, windows that are not coming loose from the walls as the walls rot. A major advantage is that the city bus comes up the street the house is on so they can sometimes get places on their own. Since the wife has mobility problems that make it hard to get on and off the bus, my husband or another friend provide transport as often as possible.

I hope your cousin doesn't end up homeless after his mother passes. It might be too late to do anything about it, though.

[enough]

13. It's strange how people find this hard to understand. NT

[WinkyDink]

14. If he can show he took care of his Medicaid parents, he can probably retain the house. See:

https://aspe.hhs.gov/basic-report/medicaid-estate-recovery

[Hortensis]

52. Is he the only inheritor? Or even THE inheritor? Many states

allow people to be tossed out of homes they've occupied for years while caring for relatives in order to settle the estate. Nothing considered due them.

Other states consider they have earned rights even if a grouchy parent leaves everything to someone else. Hillary Clinton planned to extend equitable caregiver rights to what had been their homes to all states, with the help of Democrats in Congress, of course.

[Jersey Devil]

29. NJ exempts real estate that is the domicile of the person on Medicaid from reimbursement to spouses

and dependent children. This way the surviving spouse of someone in nursing home care and on Medicaid can keep the marital home lien free.

[DURHAM D]

30. The "child" is 64 years old and draws SS. nt

[WinkyDink]

66. Yes, spouse. NOT sole-surviving adult children.

[Jersey Devil]

70. I said "dependent" children

That would include only minors and the disabled.

[WePurrsevere]

5. A year or so ago I 'finally' talked my 95 yo dad...

Into getting an elder care lawyer since he's been struggling to meet the at home nursing care costs for my mom with dementia and I know there's help available, tricks that can be legally used.

If you are elderly (or have a loved one that is) and have assets you'd like to protect... I HIGHLY suggest you get an Elder Care Lawyer and the sooner the better.

[WinkyDink]

17. I went to a vaunted local ECL, and her best advice was to

somehow get the VA to pay something towards my mother's (vet's widow) care. Uh, no. The VA wasn't having it.

There is, in my experience, no truly legal way for a person WITH assets to HIDE those assets from the govt to get funds for nursing homes, home nursing care, or LTC---not beyond Medicare's 100 days or Medicaid's asset depletion.

Transferring monies to beneficiaries to avoid their, the assets', finding is asking for trouble. There's a 5-year window of opportunity; less than that time-frame, and it looks like a ploy.

[WePurrsevere]

25. I'm truly sorry the one you found for your mom wasn't helpful...

Thankfully the one my dad (a WWII vet btw) found has been excellent and very patient with my dad.

There wasn't any property transfer. There were a few legal terms my dad used but they've fled my mind ATM. I Googled them at the time he told me though and they looked legal.

What I remember is that my (step) mom is now in sort of pay down thing Medicaid has while what's left of my dad's assets are separate (he was paying for her out of his when hers ran out). They've always had plenty of insurance, lived comfortably and had yours, mine and ours accounts and the house in jointly owned but their decades of careful saving (she was a HS Biz Ed teacher and he was an account for GE so this is their 'thing') have been almost totally wiped out by this.

I know it's a fed program but Medicaid varies a bit from state to state so I wonder if the pay down program my dad has my mom now on is a NYS thing. He has to pay a couple thousand a month so it's not free... It may be the "asset depletion" thing you mentioned... it sounds income dependent/sliding scale but IDK. (I was more concerned with calming my dad down at the time). All I know is that he had to fill out a LOT of forms, send a lot of paperwork in and it took months for Medicaid to kick in for her.

It's been very difficult for my dad on a few levels at his age but he adores her and is very determined to keep her home and help care for her as long as he is able to.

[WinkyDink]

67. I think it makes a difference if the war veteran is still living. IDK.

[WePurrsevere]

69. Maybe. Personally I think...

the surviving spouses (that were married to a vet while they were serving in a combat zone) should continue to get benefits for life.

[jeffreyi]

21. That's been true for many years...

We checked into medicaid qualifying for my mother at least 20 years ago. At that time, anyway, assets could be legally shifted to avoid downstream effects.

[WePurrsevere]

27. Yes, it's definitely been that way for quite a few years.

It depends on how and when it's done so the sooner those legal ways to handle things are learned the better IMO. IME a lot of lawyers will give a free 1st consultation so making a list and an appointment to see what they say costs only time and gas.

[WinkyDink]

12. Um...how would Medicaid be offered to one who could leave an inheritance? And if you mean house,

well, Medicaid ain't a free ride for the heirs.

[DeminPennswoods]

19. Nursing home subsidy

IIRC, around half of all Medicaid expenditures pay for nursing home care. The way Medicare works for nursing home care is that if you have less than x$s of assets, Medicare will pay for the cost of nursing home care. People with savings over that amount or significant savings will often put them in irrevocable trusts that are outside of what Medicaid counts as an asset. That way to Medicaid, the person in nursing home care appears destitute and Medicaid picks up the cost of care. Homes can also be put into irrevocable trusts or can be sold to relatives for a nominal cost, say $1.00.

Once a person is qualified for Medicaid, whatever pension(s), annunities and/or social security income they receive is redirected to the nursing home with Medicaid paying whatever their reimbursement ceiling is.

Medicaid does not consider savings in IRAs or other qualified pension savings as assets. In order to qualify for Medicaid, the person applying has to spend at least 1/2 their remaining assets before Medicaid kicks in. You're probably heard this as "spend down".

I'm not a lawyer or estate planner, but I had the experience of having power of attorney for a relative who spent their last few months in a nursing home and covered by Medicaid.

[jeffreyi]

22. This

[McCamy Taylor]

16. You can get Medicaid based upon the severity of your illness and your lack of income

if you are old enough and sick enough. This does not mean that you can not have any assets--just that the assets can not be used at this moment to pay for your health care expenses. Once you are dead and no longer need your car or clothes or other stuff, the government can claim them.

What ought to really frighten folks is the fact that it is already legal for states to make adult children reimburse them for Medicaid nursing home and other expenses for elderly parents. They don't do it--yet. But the GOP is trying to make it happen.

[WinkyDink]

18. "Under Medicaid law, following the death of the Medicaid recipient a state must attempt to recover

from his or her estate whatever long-term care benefits it paid for the recipient's care."

http://www.elderlawanswers.com/medicaids-power-to-recoup-benefits-paid-estate-recovery-and-liens-12018

Heirs are not supposed to benefit from Medicaid; only the beneficiary himself or herself.
That's the deal, the contract, the bargain for allowing the beneficiary to retain, while on Medicaid, one's house and car.

After death, no, no, no, Son and Heir; you don't get to keep those assets. The deal wasn't with YOU!

https://aspe.hhs.gov/basic-report/medicaid-estate-recovery
~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~

I don't know about other states, but I assure you this is done in Pennsylvania.

[Hortensis]

53. Only right. Someone will pay, and it should be the person

receiving Medicaid; other taxpayers pay only what the person cannot.

[pnwmom]

46. Right -- that's the much bigger, scarier issue. And it's only some states now, but there's nothing

to stop other states from passing similar laws requiring children to support their elderly parents.

[Hortensis]

54. Half those children are voters, the other half will be.

Speaking of inheritances, what happens to those when a parent has to stop working the last 20 years of his or her economic life to provide nearly 24/7/365 eldercare, a trap so many only finally escape when they no longer have any marketable skills and are getting too old to work full time themselves anyway.

Hillary planned to allow them to deduct costs for necessary purchases for those they're caring for, such as Ensure and diapers. Shockingly, these expenses are not deductible on federal returns now.

[marybourg]

20. "affording you an inheritance",

but crying poverty and forcing the taxpayers to pay for their care? Not a very sympathy-inducing complaint, in my opinion.

[DeminPennswoods]

41. Medicaid has a 5 yr "look back"

If you/family member is in a nursing home, Medicaid has a 5 year look back period. It's meant to deter people from creating trusts just before someone is put in nursing home care shortly before they die just to keep from spending any money on nursing home care. It used to be 3 years, the average number of years a patient spends in nursing home care, but was changed to 5 years not that long ago. If the patient dies within a 5 year window of the creation of a trust(s), then it's a good chance Medicaid will try to recover at least some of what it spent. However, I believe Medicaid pays less than what nursing homes charge non-Medicaid patients so it might end up costing less even if one has to repay Medicaid.

[marybourg]

59. Many people object to that rule,

and complain that their parent's money goes to "the nursing home" or "the government" instead of coming to them after the parent(s) received Medicaid for nursing home stays. That's what the OP seemed to be saying.

[Justice]

24. No, it is that Medicaid won't be available after you've spent $$ you thought would be inheritance

Rule has been that you have to spend down your assets before qualify for Medicaid. You have to cash in life insurance policies you own, you have to pay the nursing home and otherwise buy things for yourself. Once you do that, Medicaid will pay for nursing home, plus your social security and pension go to nursing home.

Under new proposed rules, once you spend every dime of your loved one's one on the nursing home, they will discharge your parent or loved one to you -- they will not keep them b/c there will be no medicaid. They will get their social security and pension, and be in your home under your care until they die. That is what Price and GOP want.

Not to mention that nursing homes will close b/c lose patients. Only ones that will survive are private pay facilities.

[bettyellen]

26. THIS is OP worthy- not the old rules we'd be lucky to keep. The 1/3 cut in Medicade

is somehow left out and that's pretty crucial. Thanks for this post!

[MichMary]

32. I find this very difficult to believe

that even Trumpy would be that ignorant. Most people aren't equipped or trained to deal with the physical and mental problems of the elerly. And even the Greedy Old People know that.

[Hortensis]

56. Irrelevant. And GOP voters do NOT want this. But their

congressmen and senators for the most part do not represent them. They represent extremist wealthy donors who think everyone else is sponging off them and want to put a stop to it.

Both the Kochs, and the hundreds of metamillionaires and billionaires alllied with them, as well as Robert Mercer, closest billionaire wingnut to Rump, want to get The People off their backs. Those who can't pay all their own pay are unworthy sponges and should be left to find a way on their own.

While strong conservatives have always opposed safety net programs like Social Security, many conservatives believes some were appropriate, and most believed in the need for compulsory public education. No more. The Republican Party has overall become far more extreme. The goal of these people who've packed Congress with their people is to completely destroy ALL social programs, every one, and change the Constitution to outlaw compulsory taxation to pay for such things, including public schooling.

Those who vote for these people don't know this. Fox never clued them in. BUT, we're almost to the point where they can't miss it. The reason why Ryan wants to spread the losses out over several years while propagandists continue to convince people the programs were doomed to fail anyway.

[TBA]

28. I have an adult son 100 percent disabled

On Medicaid. I was aware that the monet I left him would be subject to forfeiture by the state to compensate for what had been paid on his behalf. I sought the advice of an Elder Law Attorney. We now have things arranged so a trust will continue to provide for him after I die. See an Attorney if you are in a similar situation.

[MichMary]

31. I, for one, have no problem with this

Too many cases of scumbags dumping the bill for their parents' care onto the taxpayers so that they can "spend their inheritance" on a McMansion, or whatever.

[mantis49]

42. I agree.

I've worked in long term care for almost 25 years. I've seen too many instances where children of residents try to game the system so that Medicaid (meaning us as taxpayers) foots the bill so that they can get what they consider to be theirs.

IMO, the elderly worked and saved all their lives to provide for themselves when they get old. For the most part, they didn't do it to provide their children with an unearned windfall. That is what is meant by "saving for your old age."

[MichMary]

47. Yup.

I tell my kids that if I die with a nickel in my pocket I won't have lived as well as I could have! I'm really only half joking about that.

My dh's grandfather was a tight-fisted old bastard who could squeeze a dollar til George Washington screamed. He had a shit-ton of money, and got "estate planning" so that his four kids could walk away with a pile of $$$, while the taxpayers of the state of Wisconsin picked up his bill. My m-i-l didn't feel the least bit guilty about him being on Medicaid, because he got the same care as the self-pay people. And--"screw the taxpayers!"

[pnwmom]

48. I don't have an issue with the required spend-downs, either. But there's a much worse possibility.

A number of states have old laws still in place that required children to pay for the support, including nursing home bills, of their elderly parents. Those laws were moot with the passage of Medicaid, because states that wanted Federal Medicaid funds had to agree not to enforce the laws requiring children to support their parents.

With Medicaid put into block grants, states would be free to go back to enforcing parental support laws against children.

[MichMary]

50. That would suck bigly. n/t

[Hoyt]

34. In most cases, don't really have a problem with that. Rather we have coverage that makes it moot. nt

[Adrahil]

37. Living trust avoids that. NT

[lostnfound]

63. Actually there are filial support obligations that children have in most states

If a parent is indigent, they are obligated to pay for their care out of their own money
So I don't think a living true would protect against that.

Filial support laws haven't been enforced much, but I suspect that is going to change. It's the last reservoir of middle class wealth.

[Demsrule86]

39. Medicaid has always taken everything a person has when you go into a nursing home...which

is very expensive but since Medicare won't cover such care, nor will gap insurance and even long term policies won't cover that much...people rely on Medicaid...and Trump would literally toss old people out of nursing homes onto the street with Trumpcare.

[hunter]

40. So what?

I'll be God damned if I ever expect any inheritance.

Leaving this place with a negative balance is a win.

I will laugh at the debt collectors.

[dembotoz]

45. this is why older people put their homes in trusts

if they can stay out of a nursing home for the allotted time, the house goes to the kids.

hell half my family had them.

when you do the estate questionnaire during probate there are a series of questions associated with this cause the state is first in line.

making end of life decisions for my mom as she was dying i asked with each one who pays for this.....

when she failed rehab i had her go back to the hospital for what was their hospice like thing cause it was medicare as opposed to the rehab center nursing home hospice which would have not been covered the same way. Felt ghoulish, but i did talk it over with her in one of our last fairly coherent conversations and it is what she would have wanted. The protection of the house as an asset was always foremost in her mind....depression era kid

[hunter]

61. If I inherit anything beyond a financial catastrophe I'll be sad.

That would mean my parents didn't enjoy all they earned.

[WinkyDink]

68. Are you sure your mother was on Medicaid?

[Bayard]

55. There was never going to be an inheritance in my family

We were always dirt poor. Five kids, two with catastrophic illness from a young age, in and out of the hospital all the time. No insurance. In their 80's, my dad had a stroke paralyzing half his body, my mom developed Alzheimer's. There was no choice about putting them in a nursing home/assisted living facility. They fought tooth and nail about going to one. My dad died miserably a few months after going there. All they had was their property, which wasn't worth much. Medicaid took that.

Unless people retire with a pension or some other kind of retirement fund, they have to subsist on Medicare and help from their families. You should be allowed to age with DIGNITY, without the worry you're about to lose everything.

I believe Universal Health care would solve much of this situation. We hear a lot about it in other countries, but not about the treatment of seniors and disabled people. Anyone know?

[mainer]

58. Would it be preferable for taxpayers to pay granny's medical bills

while you make off with her house? I don't think so.

[Duppers]

64. Agreed.

My mom is 92 and has only a few years left some of which will have to be in a care facility.

The state can take her house as far as I am concerned. My two siblings waver on this issue. My sis talked with an Elder Care attorney but has not shared with me. There are so many factors in this decision but I believe in being fair.

[beachbum bob]

62. I have no problem with this...

You best spend your assets before having you bills pick up by the taxpayers

[Hamlette]

65. i don't have any problem with it, i am not owed anything from my parents

and had they owed for their care, i would have been happy to pay it back.

you only get medicaid if you are in a nursing home or poor and if you need nursing home care, medicaid pays for it, not medicare and the state can come after any balance due.

you can set up a trust to hold your money and help offset expenses not paid by medicaid but at your death, the trust may pay back any bills that were unpaid.

i'm not from a wealthy family, i received a bit from my mom but i don't consider it mine and i'm holding it for my son or grandkids. and while i would like to leave them some money, if it is all gone, they are owed nothing.

[question everything]

71. But, hey. You don't have to pay estate taxes

on your millions.

And the deplorables who, many of them, are dependent on government support, still applaud him.