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Will the Gifts I Give My Parents Count as Income When They Apply for Medicaid?
I own the home my parents live in and I gift to them a combined $26,000 each year. These funds are used to pay their health insurance supplement, long-term care policies, and living expenses. We are looking at moving them to an apartment with services, and if needed they will eventually go into a nursing home. How will this affect their eligibility for Medicaid if and when they ever go into a nursing home? They each receive Social Security, which gives them a combined net income of $1,800 a month. They have no other pension or income and do not own any assets. Because I have been gifting them funds to help support them, will I then be obligated to pay for their nursing home care?
No, your generosity will not mean that you have to keep it up when they move to a nursing home. Under the Medicaid rules, nursing home residents must contribute their income towards their cost of care, but only the income to which they are legally entitled. Once they move, you can continue to make payments for extras for them. Just don’t give them any money directly, since that could be construed as income to them. And, if they have long-term care policies, as you say, they may not need Medicaid in any case.
For more information about Medicaid's income requirements, click here.
For more about long-term care insurance, click here.