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Old 01-17-2018, 06:12 PM   #41
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BWE: no the $ went to the daughter when the dad died. It was perfectly legal and I like my friend a lot but sometimes what is legal is not moral if you ask me. Each state is different. They sought the advice of an attorney and followed his advice when the mom went into a home.
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Old 01-18-2018, 03:53 AM   #42
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Originally Posted by Luck_Club View Post
Many on this board "manage" their withdrawal strategies to maximize gov't subsides all the time.



Magic SS claiming time

Magic Roth Conversion formula

staying under ACA subsidies



Hypocrisy at its best!



I smell porky with this one...getting government out of the subsidy (charity) business would solve all these problems.


I have to agree that I donít understand why several people think itís wrong to shield assets to qualify for Medicaid, but are ok with all of the other things you mentioned. Philosophically I see no difference between reducing income to qualify for ACA subsidies when one has the resources to pay for unsubsidized insurance and shielding assets so that one can get Medicaid to subsidize LTC costs.
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Old 01-18-2018, 04:35 AM   #43
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Originally Posted by Luck_Club View Post
Many on this board "manage" their withdrawal strategies to maximize gov't subsides all the time.

Magic SS claiming time
Magic Roth Conversion formula
staying under ACA subsidies

Hypocrisy at its best!

I smell porky with this one...getting government out of the subsidy (charity) business would solve all these problems.
What does when to claim SS or deciding if and when to do Roth conversions have anything to do with government subsidies?

Unless you think anything someone does to reduce their taxes such as itemizing deductions is getting a government subsidy?

BTW - I find it rather troll-like to throw something provocative out there and then warn that you smell porky. Are you trying to get the thread shut down or trying to prevent others from arguing because they’ll be afraid of shutting the thread down?
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Old 01-18-2018, 06:17 AM   #44
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Hiding one's assets in order to access Medicaid (nursing home care) is SOP here in Mass. Lawyers advertise under the "Elder Care" euphemism.

IIRC 97% of all nursing homes in Mass are paid by Medicaid and there is no difference in care whether you self pay or via Medicaid.

In fact, last year I self paid for my brother's nursing home care and they had a hard time figuring out how to bill me as it was so unusual. His therapists urged me to find a way to get him on Medicaid as the therapies were so much better than what he was getting via BCBS
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Old 01-18-2018, 07:21 AM   #45
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IIRC 97% of all nursing homes in Mass are paid by Medicaid and there is no difference in care whether you self pay or via Medicaid.
The difference is in which facilities will let you enter without being able to pay.

Once you are in, virtually all will let you stay should you run out of money and require Medicaid. But many won't accept Medicaid initially.
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Old 01-18-2018, 07:24 AM   #46
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Life Estate Deeds are big in NY. Basically gives your house title to a trust, but you have a right to reside in the home until death. At death the house title transfers to the named person in the trust. Since you don't own the house any more it is not subject to estate recovery.
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Old 01-18-2018, 07:34 AM   #47
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The difference is in which facilities will let you enter without being able to pay.

Once you are in, virtually all will let you stay should you run out of money and require Medicaid. But many won't accept Medicaid initially.
What I was trying to say is that 97% of nursing homes in Mass accept Medicaid patients upon entry.
Almost everyone in a nursing home here is paid by Medicaid (called MassHealth) either through need or via legal "elder strategies" and, as I learned, the benefits and quality of care are identical (perhaps by law?) to the few who self pay.
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Old 01-18-2018, 08:28 AM   #48
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+1 about LTC policy inhome care coverage. Paying for a MassMutual policy since age 57. Btw, there are many nursing homes that don't take Medicaid, ever, at least in my state. Private pay doesn't always equal great care, but it seriously helps. Some care quality stats can be found at nursing home.gov website that CMS populates with good data. Truly, the scariest scenario is Alzheimer's, dementia and pressure ulcer wound care. Anything else can usually be managed by skilled home care visits. Urinary incontinence is the big problem that causes the pressure ulcers, so keep those kegel exercises up people!
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Old 01-18-2018, 09:15 AM   #49
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It is important to understand that Medicaid, unlike SS claiming dates, ACA qualifications and Roth conversion tables, is a government program only intended to provide a last ditch safety net for only the poorest of the poor. There are many, many people who genuinely have no or very limited assets and who desperately need the services that medicaid provides. Further, medicaid already places a significant and increasing burden on taxpayers. The tangible consequence of that burden is that lawmakers are looking to cut medicaid benefits which inevitably results in decreased quality of care for medicaid recipients.

Medicaid was never intended to provide benefits for individuals for those capable of paying for their own care. The entire purpose of the lookback is to avoid schemes, legal or otherwise, to prevent persons from transferring assets in order to place the burden of their care on the taxpayers, instead of using their own assets to pay for their own care. While medicaid eligibility rules differ from state to state, all states allow for the retention of assets, including a house, by a spouse.

Frankly, I believe the lookback period should be substantially longer that 5 years to prevent some the schemes that are being used to essentially shift the cost of care from individually who are financially capable of paying their own way to other taxpayers.
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Old 01-18-2018, 09:41 AM   #50
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Originally Posted by Luck_Club View Post
Many on this board "manage" their withdrawal strategies to maximize gov't subsides all the time.

Magic SS claiming time
Magic Roth Conversion formula
staying under ACA subsidies

Hypocrisy at its best!

I smell porky with this one...getting government out of the subsidy (charity) business would solve all these problems.
All of the above are just managing the timing of when income is recognized... claim SS at 62 vs FRA vs 70, do Roth conversions while your tax rate is lower or avoid tax-deferred withdrawals or conversions to stay within ACA limits... but they are all just accelerating or delaying income.

The Medicaid LTC game is much different... it is establishing trusts, moving/retitling assets to the trust, gifting your assets many years before you'll need nursing home care, etc.

Also, the magnitude of the benefits are a lot different... if over 5 years you Roth convert $250k at 10% rather than 22% you have saved $30k in taxes... if you get 5 years worth of nursing home coverage paid for by taxpayers then that is $175k +/-.... pretty significant difference IMO. Ditto for ACA subsidies... and for SS timing in theory minimal cost since it is supposed to be designed to be actuarially neutral.
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Old 01-18-2018, 10:22 AM   #51
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It is important to understand that Medicaid, unlike SS claiming dates, ACA qualifications and Roth conversion tables, is a government program only intended to provide a last ditch safety net for only the poorest of the poor. There are many, many people who genuinely have no or very limited assets and who desperately need the services that medicaid provides. Further, medicaid already places a significant and increasing burden on taxpayers. The tangible consequence of that burden is that lawmakers are looking to cut medicaid benefits which inevitably results in decreased quality of care for medicaid recipients.

Medicaid was never intended to provide benefits for individuals for those capable of paying for their own care. The entire purpose of the lookback is to avoid schemes, legal or otherwise, to prevent persons from transferring assets in order to place the burden of their care on the taxpayers, instead of using their own assets to pay for their own care. While medicaid eligibility rules differ from state to state, all states allow for the retention of assets, including a house, by a spouse.

Frankly, I believe the lookback period should be substantially longer that 5 years to prevent some the schemes that are being used to essentially shift the cost of care from individually who are financially capable of paying their own way to other taxpayers.
You provide a cogent rationale for why some people who could well afford to finance LTC should not be beneficiaries of Medicaid assistance. On the other hand, this rationale can be applied to numerous Government benefit programs (including tax subsidy programs) where precise lines of only capturing the most deserving, intended beneficiaries are virtually impossible to conceive or draw. For example, when unemployment was extremely high a few years ago, many unemployed used the Social Security Disability Income program in a manner not fully intended by the program. And of course, we have never means-tested Social Secruity retirement benefits so that those truly in need benefit the most. From my point of view, I don't see the difference in taking full advantage of Medicaid, Social Security programs, tax exemptions or subsidies, etc.

To me, I see hypocrisy when folks take full advantage of some government benefit program by running through various chutes and ladders and then rail against others taking full advantage of Medicaid by going through its chutes and ladders.

I think there is something more basic in the sense of indignation that some folks have when assessing the perception of unfairness that people see when others take advantage of Medicaid assistance by "sheltering assets." It's not grounded in rationale thinking, in my view, but it's more emotional like the sense that someone is gaming the system to your detriment. I can understand how it could be bothersome, but it is kinda of hypocritcial when you're also gaming or using the system to your benefit.
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Old 01-18-2018, 10:34 AM   #52
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What I was trying to say is that 97% of nursing homes in Mass accept Medicaid patients upon entry.
If you are trying to say that 97% of nursing homes in MA will accept a new patient paying via Medicaid, I'm not so sure about that number. That is not my experience. Perhaps you can provide a link.

If instead you are saying that 97% of nursing homes will allow a patient to continue there when their payment source changes from whatever they had before to Medicaid, then I'll believe it.
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Old 01-18-2018, 11:22 AM   #53
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+1 about LTC policy inhome care coverage. Paying for a MassMutual policy since age 57. Btw, there are many nursing homes that don't take Medicaid, ever, at least in my state. Private pay doesn't always equal great care, but it seriously helps. Some care quality stats can be found at nursing home.gov website that CMS populates with good data. Truly, the scariest scenario is Alzheimer's, dementia and pressure ulcer wound care. Anything else can usually be managed by skilled home care visits. Urinary incontinence is the big problem that causes the pressure ulcers, so keep those kegel exercises up people!
Of course, who wouldn't prefer to remain at home and receive assistance there. Sometimes that's not an option, though. And in most states, live-in caregivers require little to no certification or training, so finding a good one can be a crapshoot.

Ideally, a family member can help by supervising and providing some additional care when assistants are off duty. But in the case of couples, when one needs living assistance, the other may not be much better off. Kids may live some distance away.

I remember my mom telling my sister and me as her health was failing that she and Dad had talked it over and above all they didn't want to be a physical burden on their children. Dad was in good enough shape to look after Mom, but even so she spent some weeks in skilled care after discharge from hospitals. She did live her final days at home.

Some years later, Dad developed dementia and became completely dependent on me. He was quite paranoid and did not let people who were not friends or family into his house. After several months of that relationship, which was not adequate for his well-being, we finally convinced him to move into assisted living. There his physical and mental condition improved markedly. A big part of that was the social interaction with other residents. He even met a ladyfriend.
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Old 01-18-2018, 11:43 AM   #54
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In fact, medicaid is a social welfare program, most directly comparable to other government social welfare programs like food stamps, WIC and CHIP. In some respects, it is comparable to SSDI. However, SSDI is essentially an early qualification for SS benefits. It is generally difficult to qualify for. Many SSDI applicants are denied.

SS was never intended to be means tested and SS benefits are based on what the recipient has paid into the system over time. Comparing Medicaid to SS is simply not an apples to apples comparison. Similarly, tax exemptions, subsidies and similar programs are not government welfare programs, at least as that term is generally used when describing social welfare programs.

In order to qualify for Medicaid you either have to spend down your assets or you have to deliberately impoverishing oneself by conveying assets. That is substantially different from the SS, Roth IRA, ACA subsidies, exemptions, etc, that are generally cited as justification for the Medicaid trusts used to game the system.

Medicaid trusts used to game the system may be legal, at least at the moment. But, in my opinion, people who are able to pay for their own care should do so, either directly or through the purchase of LTCI.
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Old 01-18-2018, 11:44 AM   #55
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What I was trying to say is that 97% of nursing homes in Mass accept Medicaid patients upon entry.

Almost everyone in a nursing home here is paid by Medicaid (called MassHealth) either through need or via legal "elder strategies" and, as I learned, the benefits and quality of care are identical (perhaps by law?) to the few who self pay.


Actually 61% of Mass nursing home residents are paid by Medicaid, which is slightly below the national average.

https://www.kff.org/infographic/medi...ing-home-care/
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Old 01-18-2018, 12:26 PM   #56
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Life Estate Deeds are big in NY. Basically gives your house title to a trust, but you have a right to reside in the home until death. At death the house title transfers to the named person in the trust. Since you don't own the house any more it is not subject to estate recovery.
You got it a bit off here. The "life estate deed" works by the owner transferring most of his interest in the home but he reserves a "life estate interest" in the home, which allows him to reside or own the house during his lifetime. But the transfer itself is subject to the 5 year lookback and afterwards the "life estate interest" is valued and counted as a resource for Medicaid purposes. Upon death of the life estate owner, complete home ownership is vested in the person who was originally transferred the extant interest, so there is nothing to recover from the prior life estate owner.

BTW, people here might be under the impression that it's easy to shelter assets or home ownernership from the 5 year lookback period -- it really isn't -- anything you transfer, with few exceptions, is captured by the lookback. 5 years appears to be a reasonable period of time to cover transfers that are patently designed to manipulate the system -- it used to be 3 years a decade ago. Going beyond 5 years for a lookback would capture a lot more transfers, but that would also capture a lot more innocent transfers, too.

And in death, unless you have a life estate in the home or there's a joint owner living in the house, Medicaid will attach a lien on the property in the estate to recover amounts that Medicaid expended for LTC for your behalf.
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Old 01-18-2018, 02:45 PM   #57
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SS was never intended to be means tested and SS benefits are based on what the recipient has paid into the system over time. Comparing Medicaid to SS is simply not an apples to apples comparison. Similarly, tax exemptions, subsidies and similar programs are not government welfare programs, at least as that term is generally used when describing social welfare programs.

In order to qualify for Medicaid you either have to spend down your assets or you have to deliberately impoverishing oneself by conveying assets. That is substantially different from the SS, Roth IRA, ACA subsidies, exemptions, etc, that are generally cited as justification for the Medicaid trusts used to game the system.

Medicaid trusts used to game the system may be legal, at least at the moment. But, in my opinion, people who are able to pay for their own care should do so, either directly or through the purchase of LTCI.
I don't see the difference, sorry. We all pay into Medicaid and government assistance programs, and tax subsidies or exemptions, are no different -- they all represent a charge against the general taxpayer that don't necessarily benefit everyone. Each has its own rules for eligibility. And I think it's not entirely accurate to say that "SS benefits are based on what the recipient has paid into the system over time, " because, after all, there are many recipients like surviving spouses, divorced spouses, or dependent children who aren't paying into SS and are getting benefits beyond any reasonable return generated by the person whose earnings record benefits are based. And in Social Security, the Government tries to adjust benefits so that there's a sense that folks are not unjustly or unfairly benefitting from the system -- it's why we have WEP and GPO, and why the bend points benefit low wage earners; and why file and suspend (and the old, unlimited "do-over" rule was) eliminated.

Frankly, as said before, I don't see the difference in going thru chutes and ladders of program eligibility, whether it be Roth Conversions, ACA, 1031 rules, or Medicaid.
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Old 01-18-2018, 03:45 PM   #58
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There definitely are differences even if you are unable or don't care to see them.

If you have a high career earner vs a low career earner their disability, retirement, survivor, spousal and dependent benefits will be quite different... reflecting that they made different contributions to the system... and while those benefits may not be perfectly proportional to their contributions due to bend points, etc. .... they are nonetheless significant enough to fairly say that benefits are relative to contributions. Also, there are specific payroll taxes that fund these benefits and they do not come out of general fund taxes.

No one "pays into" Medicaid or other gov't programs (SNAP, CHIP, etc) but those are supported by general fund revenues.

The big difference between ACA, Roth conversions, etc. and Medicaid LTC manipulations is the magnitude of the benefit when a year in a nursing home costs Medicaid $35k or more... any benefits from those other programs are peanuts by comparison.

At least in the case of Roth conversions, it is a tax minimization game and it is well established that one can arrange their financial affairs to minimize taxes. Nowhere does it say that it is proper to arrange you financial affairs to qualify for social program benefits.
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Old 01-18-2018, 04:49 PM   #59
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Sure, there are differences in the way Government programs operate and the way they are funded, but these are differences without distinctions -- in so far as the way one navigates eligibililty, which is my point. And whether the funding source is general tax revenues from personal income taxes, payroll taxes, corporate income taxes, user fees, or industry assessments makes little difference to me once the revenue sources are part of the Federal budget with cash flow that gets allocated by our Congress.

So you think the magnitude of the purported "scamming" that people go thru for sheltering assets in Medicaid is substantially higher in financial impact than the hoops that others might go thru for other manipulations to obtain maximum benefits from ACA, Backdoor Roths or Roth Conversions for tax exemptions, 1031s, corporate income tax avoidance schemes -- perhaps you might be right, though I can't fathom that anyone has made this comparison or has suitable metrics for such, but this strikes me as immaterial to the idea that there is hypocrisy to rail against one, when taking advantage of others.

Moreover, the fact that there are rules for eligibility, whether it be Medicaid or VA benefits for LTC, that permit you to arrange your financial affairs to climb thru rungs of eligibility surely suggests that this is appropriate for one to do, from the standpoint of those who create the rules and haven't changed them.
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Old 01-18-2018, 05:29 PM   #60
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....So you think the magnitude of the purported "scamming" that people go thru for sheltering assets in Medicaid is substantially higher in financial impact than the hoops that others might go thru for other manipulations to obtain maximum benefits from ACA, Backdoor Roths or Roth Conversions for tax exemptions, 1031s, corporate income tax avoidance schemes -- perhaps you might be right, though I can't fathom that anyone has made this comparison or has suitable metrics for such, but this strikes me as immaterial to the idea that there is hypocrisy to rail against one, when taking advantage of others. ...
Actually, I do... here are a few examples. I pay a little less than 10% in tax on my Roth conversions and expect to avoid 22% if I did them later.... so for an average year of $50k in Roth conversions I save about $6k. While we don't manage our income for ACA, if we did manage it to 400% FPL our subsidy benefit would be about $6k a year. To me SS timing really isn't in the same vein as the discounts and premiums compared to your FRA benefit are designed to be actuarial neutral.

OTOH, great auntie was in private pay in a nursing home many years ago and the annual costs was $70k.... so the Medicaid nursing home schemers get a $70k a year benefit... although I would concede that the cost to taxpayers is probably only a little more than half of that... but it is still at least 6x the cost to taxpayers as the other schemes.

So to me, not only are the magnitudes vastly different, but the nature of the differences (timing the recognition of income vs transferring assets beyond the reach of Medicaid) is very different too... and the combination of the two makes the Medicaid schemes much more unsavory IMO.
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