This article is so sad … a 90-year old grandmother was neglected and left to die by her live-in family members because they were afraid to apply for Medicaid for her. They thought Medicaid would take the grandmother’s home and they’d be left homeless.
While every state has different homestead and Medicaid laws, in Florida, most people will not lose their home to Medicaid if they need long-term care.
First, our state Medicaid rules don’t include your home as an asset. However, if your home needs to be sold while you’re receiving Medicaid, and planning wasn’t done ahead of time, the cash proceeds will be counted and you could be kicked off Medicaid.
A married applicant can transfer the home to her spouse who still lives there. (However, that may create a problem if that spouse later needs Medicaid).
There are ways to protect the home of an unmarried Medicaid applicant, and still be eligible for Medicaid. The applicant could transfer the home to:
- A child who is under age 21 or who is blind or disabled;
- Into a trust for the sole benefit of a disabled individual under age 65 (even if the trust is for the benefit of the Medicaid applicant, under certain circumstances);
- A sibling who has lived in the home during the year preceding the applicant’s institutionalization and who already holds an equity interest in the home;
- A “caretaker child,” who is defined as a child of the applicant who lived in the house for at least two years prior to the applicant’s institutionalization and who during that period provided care that allowed the applicant to avoid a nursing home stay.
Or, even better, protect the home through a little advanced planning. This may include use of certain trusts to protect the house from estate recovery.
What’s estate recovery? That’s when Medicaid takes your assets when you die to pay back the government for what it spent on your care. Again, every state has different laws about Medicaid estate recovery. In Florida, at this moment in time, Medicaid can only take your assets that go through probate. No probate? No recovery. That law will likely change as more and more people use Medicaid to pay for their long-term care costs.
Don’t operate on fear or misinformation. Talk with an elder law attorney long before Medicaid might be needed. Learn your options and make an educated decision.
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