Parents and Medicaid questions

[nanannjen]

We will hopefully finally sell our house this year and be able to move to a lower cost of living area. We asked my parents (87 and 91) to move with us - my brother is not local, and they are at the point where they need our support. However, I'm concerned about their buying a home at this point - they can't do the maintenance any more, and when my dad passes my mom will probably move in with us. So it doesn't make a lot of sense to me for them to buy. (although that is their preference - to remain independent.)

However, I am concerned about their assets if they don't buy a house - they won't have a lot left after they pay off their reverse mortgage, but it will be about $200k. Plenty for the government to take if my dad needs nursing home care!

One option that I'm wondering about would be to buy a house with a guest house. I would have my folks contribute - maybe $150k - and have their names on the deed with ours. Then they would live in the guest house. We'd be paying cash, so no mortgage issues.

There's a lot of logistical details that I'd have to work out with my brother, but I'm not worried about that - he's just grateful that we're taking care of them!

So, would that cause an issue with the 5 year lookback? What are the pitfalls associated with having their names on the deed with ours? What am I missing here?

Thanks in advance!

 

[dmdunca44]

but it will be about $200k. Plenty for the government to take if my dad needs nursing home care!

If your dad needs nursing home care, what is the plan to pay for it?

 

[nanannjen]

As far as the nursing home care, I believe that my mom would be able to protect half of their remaining assets - then it would be a Medicaid situation.

 

[dmdunca44]

As far as the nursing home care, I believe that my mom would be able to protect half of their remaining assets - then it would be a Medicaid situation.

A " Medicaid situation" meaning you expect me (as a taxpayer) to pay for your dad's care so that your parents don't spend their own money?

 

[M Paquette]

A " Medicaid situation" meaning you expect me (as a taxpayer) to pay for your dad's care so that your parents don't spend their own money?

Hey, they're trying to work out a solution to house their parents, provide family based care, and avoid the pitfalls of complex Medicare rules should a worst case situation arise where they can't handle the care.

Comments like this may not be appropriate here.

 

[nanannjen]

Well, golly, they would be spending their own money providing for a place to live - the question is where they do that. I don't really want to get into a debate on the morality of Medicaid - I am trying to make sure that my parents don't outlive their money.

 

[jclarksnakes]

A " Medicaid situation" meaning you expect me (as a taxpayer) to pay for your dad's care so that your parents don't spend their own money?

Do you realize that the best money saver for all of us taxpayers is for adult children to provide local care for their parents for as long as needed? The OP seems to be interested in doing the very best thing for his parents. Please give him a break.

 

[Nords]

A " Medicaid situation" meaning you expect me (as a taxpayer) to pay for your dad's care so that your parents don't spend their own money?

So, how did you handle the situation for your parents?

 

[2B]

If your parents can not maintain their home, they certainly shouldn't be buying one. I would think they would be better off in some sort of independent living. They will, of course, object to the thought of being in an "old folks home." I have seen with my in-laws and other elderly individuals that the quality of life improved dramatically with the opportunities for socialization and the reduced burden of daily life.

Before your parents move in, make sure you understand what you are signing up for. They will continue to degenerate physically. You will soon find yourself (and spouse?) on call 24/7. Forget vacations or even a night out. Going to the grocery store will be difficult.

We all think that we will go quickly with "the big one" but that is not reality. Most of us will need help with bathing, eating, getting to doctors, etc. This care is really what is classified as "assisted living" and it is not covered by Medicaid. Nursing care is where they require skilled nursing care. It usually also means they are confined to a bed/wheel chair.

You asked about money and 5 year look back. Quite honestly, the $200,000 will probably be needed for their care before they ever qualify for nursing care or could get into Medicaid. As their only remaining assets, I wouldn't commit it to a "guest house" on your property unless you are ready to become a full time home care aide or you have plenty of assets of your own. The unfortunate reality is that most, if not all, of that money will be spent on your father's care before you mother needs her own care. Personally, I would suggest you look at how you can conserve assets and reduce their current expenses.

I will note that their reverse mortgage took their primary asset (personal residence) and allowed them to spend it putting them in this situation. They should have downsized their lifestyle the day they realized they couldn't afford their housing costs. When a senior citizen thinks they need a reverse mortgage, they really are in a house they can no longer afford. It's too late for them/you but you'll be the one living with the depletion of assets.

 

[bizlady]

My in-laws jsut went through all this in the past year and a half. Both swore no way were they going to a nursing home, and both adjusted fine.

FIL had to be placed about 2 years ago, as MIL could no longer care for him. Requirements vary some by state, so check that out. In our case, their total assets excluding the home were under 25k. She got to keep those and the house as long as she was in the house. He was allowed to sign his very small pension and SS to her for living expenses. He then was on Medicaid.

Once she entered the nursing home post stroke and with early dimentia, they had to spend down to 3K each, and the house had to be sold. House was very modest and proceeds turned over to the county.

He has since died, and she is still there- and happy. Loves all the attention. She is now on Medicaid. Her money goes each month toward her expenses, except $92 which is allowed for personal items.

This is emotional for everyone. This was a case where they truly had nothing, so you would think it is easy. Not so. DH has severed relationship with his brother who is angry that we would not lie about what little was there. His sister too thinks she got ripped off.

We laid it all out to everyone before it all happened. The emotions still take over.

From our perspective, we are so greatful that there was a safety net to cover living expenses, medical, medicines etc. The money was their's and absolutely should go toward their care.

The 5 year look back is in play. You would be required to buy your mom out once she moves out. They will look back at bank statements for 5 years.

Perhpas you can find an assisted living apartment for them where they can live indepently, but still get meals and assistance.

Good luck. The journey is just beginning.

 

[dmdunca44]

So, how did you handle the situation for your parents?

My mother impoverished herself by giving everything she had to her church (she was probably in the early stages of dementia at the time). I had no say in the matter. She lived with my sister for five years (I provided respite care). By the time she needed institutionalization, her circumstances qualified her for Medicaid.

My husband and I have LTCi because we wish to avoid becoming a burden on either my kids or the taxpayers. I am grateful for the safety net that Medicaid provides, but I consider it as a last resort and would spend every dime on my care before applying rather than try to hide it or "protect it" as the OP said.

 

[nanannjen]

My husband and I have LTCi because we wish to avoid becoming a burden on either my kids or the taxpayers. I am grateful for the safety net that Medicaid provides, but I consider it as a last resort and would spend every dime on my care before applying rather than try to hide it or "protect it" as the OP said.

This has nothing to do with our situation. We have funded OUR retirement - we do not anticipate being a burden on our children. However, Medicare absolutely is a last resort for my parents. I fully expect my mother to live another 10 -15 years. I am trying to "protect" her future life enjoyment.

 

[dmdunca44]

This has nothing to do with our situation. We have funded OUR retirement - we do not anticipate being a burden on our children. However, Medicare absolutely is a last resort for my parents. I fully expect my mother to live another 10 -15 years. I am trying to "protect" her future life enjoyment.

I understand (and apologize for the earlier snarky tone). I believe (and you really need to consult an eldercare attorney) that she could have some funds (the amount varies by state) that would not be required to pay for your dad's care.

The thing about buying a property with your parents and you all on the title is that if your dad goes on Medicaid, then after his passing, they can put a lien on the property to collect funds owed them for his care.

You really need to consult with an eldercare attorney who is familiar with the laws in your state. Although Medicaid funds come from the federal gov't, the program is administered by the state and rules vary.

 

[haha]

This has nothing to do with our situation. We have funded OUR retirement - we do not anticipate being a burden on our children. However, Medicare absolutely is a last resort for my parents. I fully expect my mother to live another 10 -15 years. I am trying to "protect" her future life enjoyment.

You likely mean Medicaid? Because Medicare in one way of another is part of the health insurance provision for all or almost all US workers and former workers past the age of 65. I believe some government worker systems are completely separate from Mediacre, but I have no detail on this.

Ha

 

[nanannjen]

You are correct - I do mean Medicaid!

 

[nanannjen]

I understand (and apologize for the earlier snarky tone). I believe (and you really need to consult an eldercare attorney) that she could have some funds (the amount varies by state) that would not be required to pay for your dad's care.

The thing about buying a property with your parents and you all on the title is that if your dad goes on Medicaid, then after his passing, they can put a lien on the property to collect funds owed them for his care.

You really need to consult with an eldercare attorney who is familiar with the laws in your state. Although Medicaid funds come from the federal gov't, the program is administered by the state and rules vary.

Apology accepted!

The part that I'm trying to verify is the part about the lien on the property - I have seen some stuff on the internet (so it must be true ) that imply that the deed could be structured such that they would not come after it. I also don't think that anything would happen at my dad's death, as long as my mom was still living there.

I know that I need to talk to an eldercare attorney - I'm just doing the advance legwork so that I know the right questions to ask!

 

[dmdunca44]

I have seen some stuff on the internet (so it must be true ) that imply that the deed could be structured such that they would not come after it.

I have too. My guess is that the states vary in their aggressivness. They CAN, vs how often they DO ...... (although it would seem that the times are changing and states are becoming more aggressive about pursuing recovery)


I also don't think that anything would happen at my dad's death, as long as my mom was still living there.

That is my understanding as well, from this siteMedicaid Estate Recovery

 

[nanannjen]

That is my understanding as well, from this siteMedicaid Estate Recovery

Great site, thank you!

 

[akck]

As far as the nursing home care, I believe that my mom would be able to protect half of their remaining assets - then it would be a Medicaid situation.

That may not be the case. Years ago, when I checked on it, only a minimal amount can be protected for a spouse. Usually a house that the spouse lives in is protected, but savings/investments beyond a minimal amount are considered available before Medicaid is available. Check with your state for how they handle it.

I'd be leery of putting your parents on the deed. It may endanger your ownership should Medicaid want to collect on your father's portion.

 

[Accidental Retiree]

You are correct - I do mean Medicaid!

MediCAL in California.

I would NOT commingle parents' funds with my own, and I WOULD see an elder care attorney.

 

[2B]

You likely mean Medicaid? Because Medicare in one way of another is part of the health insurance provision for all or almost all US workers and former workers past the age of 65. I believe some government worker systems are completely separate from Mediacre, but I have no detail on this.

Ha

My FIL was retired military and had unbelieveable no cost medical coverage. His copays for meds were pocket change and no copays for doctor visits. He didn't get anywhere near medicare. There was talk about eliminating the medical plan he was on but he passed away safely before anything was done. However, his super plan didn't cover anything involving assisted living or nursing care other than the medical part.

 

[BLS53]

My FIL was retired military and had unbelieveable no cost medical coverage. His copays for meds were pocket change and no copays for doctor visits. He didn't get anywhere near medicare. There was talk about eliminating the medical plan he was on but he passed away safely before anything was done. However, his super plan didn't cover anything involving assisted living or nursing care other than the medical part.

Medicare is part of the healthcare plan for military retirees once they reach 65. The military part, called Tricare for Life, works the same as a Medicare supplement does for civilians. But Medicare is the primary payer.

As far as I know, military retirees have no advantage over anyone else, when it comes to elder care, nursing homes etc. There's no special exemptions or asset protection. There are some veteran's homes around, but imagine the requirements to enter one are very high.

 

[haha]

Medicare is part of the healthcare plan for military retirees once they reach 65. The military part, called Tricare for Life, works the same as a Medicare supplement does for civilians. But Medicare is the primary payer.

This this mean that their doctors are paid on the same low scale as other Medicare recipients, and the same limitations apply? Or is the Tricare part allowed to step up and sweeten the deal? If it is just a Medigap Supplement, does it correspond to any of the other supplements like A, F, etc? How about drug benefits?

Ha

 

[misty57]

My mom has both Medicare and Tri Care. My understanding is that Medicare pays first and Tri Care picks up the balance. Her drugs are covered, but I don't know if that's through Tri Care or if she has a Medicare Part D. I suspect it's through Tri Care.

 

[Nords]

Medicare is part of the healthcare plan for military retirees once they reach 65. The military part, called Tricare for Life, works the same as a Medicare supplement does for civilians. But Medicare is the primary payer.
As far as I know, military retirees have no advantage over anyone else, when it comes to elder care, nursing homes etc. There's no special exemptions or asset protection. There are some veteran's homes around, but imagine the requirements to enter one are very high.

My mom has both Medicare and Tri Care. My understanding is that Medicare pays first and Tri Care picks up the balance. Her drugs are covered, but I don't know if that's through Tri Care or if she has a Medicare Part D. I suspect it's through Tri Care.

That's all correct, and TFL also pays for medications in the Tricare formulary. They're trying to cut costs by pushing really hard for mail-order refills and using more generics, so some meds may not be considered "covered" by TFL if they're not in the formulary.

Long-term care is not part of Tricare, although insurance can be purchased through the Federal LTC Insurance Program or possibly be provided through the VA with a disability rating... and the aforementioned veteran's homes, which have long needs-based waiting lists.

I don't know if this is still the case, but the Navy used to deduct 50 cents from every enlisted monthly paycheck to support the Sailor's Home. Not the officers, who weren't eligible for that housing-- just the enlisted.

Tricare reimbursements suck just as badly as Medicare and are subject to the same annual cuts that Congress is always "revising" at the last minute.