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Beware Of The Five-Year Look Back Rule For Medicaid Nursing Home Eligibility


Some people interpret every small coincidence as a sign that the government is watching their every move and trying to nickel and dime them out of all of their prosperity and enjoyment.  For the most part, though, the government will not scrutinize your every transaction unless you do something to provoke it.  That something could include asking for a substantial amount of money, such as when you apply for Medicaid to pay for your nursing home care.  Some people live in nursing homes for many years, so before Uncle Sam makes the commitment to pay for your care, he will leave no stone unturned in order to be sure that you have no other means to pay.  The five-year look back rule means that you must submit extensive documentation about your finances over the five-year period leading up to your Medicaid application.  Yes, he will pay himself back with your Social Security checks and by filing claims against your estate during the dreaded Medicaid asset recovery process during probate, but that only happens if Medicaid agrees to pay for your nursing home care in the first place.  Estate planning law firm websites tend to foreground the narrative where you spend your retirement traveling the world as only the healthiest and most financially secure seniors can do, but a Washington DC estate planning lawyer can also help you with less glamorous matters, such as Medicaid eligibility.

Can You Transfer Possession of Your House to a Family Member in Order to Qualify for Medicaid?

Medicaid will pay 100 percent of your nursing home care costs, but only if the value of your assets is below a certain level.  This is one of the reasons that estate planning lawyers often advise their clients to spend down their assets.  Just as the IRS gets suspicious if your sole proprietorship has written off dozens of meals at the likes of Fiola Mare and the Blue Duck Tavern as business expenses in a single calendar year, Medicaid will likewise cry foul if you seem to be giving away money or selling property at a loss simply for the purpose of qualifying for Medicaid.

If you are a homeowner, and you are not so wealthy that you are certain that you will never need Medicaid, then your home is probably your most valuable asset, and it is probably the biggest obstacle to your Medicaid eligibility.  If you are married and your spouse stays in the marital home while you are in a nursing home, this does not affect your Medicaid eligibility, unless you own an especially expensive house.  If you are unmarried or widowed, or if your spouse is also in a nursing home, then things get more complicated.  Your best option is to transfer your house to your sibling or child.  The only way Medicaid will let this fly, though, is if you and your sibling own the house jointly, or if your son or daughter lived with you and acted as a caregiver before you applied for Medicaid.  In other words, you have to play the long game.

Let Us Help You Today

An estate planning attorney can help you protect yourself from Medicaid asset recovery, even if you rely on Medicaid for nursing home care.  Contact Tobin, O’Connor & Ewing today.




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