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Forum Newbie
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Last Login: 9/18/2008 12:47:56 PM
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| Recently my 81 year old dad suffered a series of medical issues that are going to lead to LTC in the next 6 weeks or so. My mom is quite active and healthy for an 80 year old and still lives in their mobilehome. My parents have been financially responsible all of their lives, have about $100,000 in liquid assets and an older mobilehome worth about $45,000. However this savings won't last long at $6200/month and so we are going to meet with the local Medicaid office next week. I understand the 5 year look-back period and am very concerned that the cash gifts my parents gave long before any health issues came up are now going to come back to haunt us. For example, my parents gave me $3,000 in 2004 to help me pay for my divorce. In 2007 they lent a grandson $8,000 for a new vehicle. He has paid some of that back, but there is nothing in writing. And since my divorce they have given me $100/month; I think they wanted to be helpful in a way that was meaningful to them. Not to mention all of the holiday, birthday, and wedding gifts they gave in the form of cash instead of shopping (my mom HATES to shop). Our elder law attorney thought that the smaller gifts wouldn't be issues, but I'm really worried. And my poor mom is becoming a wreck over all of this. Also, should the grandson and I get personal loans to repay the gifts? None of us EVER thought about this scenario......thank you for any advice/suggestions.
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Last Login: 6/23/2008 1:27:21 PM
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| Do not, I repeat, DO NOT meet with the Medicaid office next week. You need to meet with a consultant or elderlaw attorney who routinely does Medicaid planning in your state as soon as you can arrange to do so. If you meet with Medicaid next week you will likely cook your own goose because they will then have a record of everything you disclose and ask about. And in most cases, staff in the Medicaid office ARE NOT your friends and do not have your family's best interest at heart. Medicaid policies sometimes vary considerably from one state to the next, but let me point out some general issues you and a competent planner need to address: The $3,000 your parents gave you in 2004 is likely no longer an issue. However, the $8,000 "loan" that has no loan paperwork will be considered a gift and will create a penalty period. Even if you "find" loan paperwork, the outstanding loan amount will likely be considered an available resource. The monthly payments to you will be considered gifts--unless you can substantiate the payments are really for services you provide your parents. The Medicaid caseworker's Operations Manual here in KY does not permit ANY amount of gifting; however, most caseworkers here that may become aware of small birthday/holiday/wedding gifts that appear to be the normal and customary gifts of your parents will usually ignore those gifts--assuming they are, in fact, small gifts. And I would speculate there are other issues you need to resolve in addition to the past gifting. It is not necessary to meet with the Medicaid office until your dad is in LTC and your mom may need a Resource Assessment (not true in all states) or until it is time to actually file an application for Medicaid. So, until you need to get your mom a Resource Assessment or to file an application, I urge you to stay away from the Medicaid office. You can get better advice and much better planning from the private sector. Joe Whitehouse, Medicaid Consultant, Louisville, Ky.
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Forum Newbie
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| Thank you. Tuesday. We have already seen an elderlaw attorney, and he advised us that we will need to be upfront about the $3000, $8,000, and monthly payments. So now I'm confused. What other info do we need? Thank you.
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Forum Newbie
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| Also, my parents do need a resource assessment - that is the purpose of the meeting on Tuesday.
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Forum Newbie
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| At what point should I take out a personal loan to repay my parents? Or should I simply pay for some of their monthly expenses, such as their mobilehome park rent? Would the entire amounts of the gifts be included in the penalty period, or would it be one half, since only one of my parents is applying for Medicaid?
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Last Login: 6/23/2008 1:27:21 PM
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| You state you have already seen an elderlaw attorney and he advised to be upfront about the $3,000, $8,000 and monthly gifting. If that's the best he can do you need to go elsewhere as he apparently does not do Medicaid planning and obviously is not up on Medicaid eligibility issues. He may be a very good attorney in other elderlaw matters but you need one that routinely handles Medicaid issues and stays current with eligibility issues. The 5-year lookback is applicable to transfers made on or ofter the new federal legislation was signed on 2/8/06. Therefore, the $3,000 transfer in 2004 was subject to the 3-year lookback and is no longer an issue. You originally stated your dad may need LTC in about 6 weeks. Assuming he is not yet in LTC, your mom doesn't need a Resource Assessment yet. And if she gets one before he enters LTC she may have to get another one after he enters LTC and that will be the one that rules. Joe Whitehouse, Louisville, Ky.
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Forum Newbie
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Last Login: 9/18/2008 12:47:56 PM
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| So let me get my head around this - we need to look at all gifts made since 2/8/2006? Thank you SO much for taking the time to explain this info!
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Last Login: 6/23/2008 1:27:21 PM
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| You need to consider all gifts made within the last 3 years; however, due to the way penalties are calculated a transfer made within 3 years of an application and made BEFORE 2/8/06 is unlikely to have an effect on an application today unless it was a very large gift. But even small gifts made on or after 2/8/06 will impact a current application because the penalty, even a small penalty, won't start running until the applicant is otherwise eligible AND an application is filed. And the full amount of a gift made by either spouse will create a penalty. And I'm sure there are likely other issues that you should learn about before you waltz into the Medicaid office and create problems for your parents that could be dealt with and possibly resolved in your parent's favor before you file an application--IF YOU OBTAIN SOME COMPETENT ADVICE NOW. Joe Whitehouse, Medicaid Consultant, Louisville, Ky.
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