Liquidating assets before medicaid
For an elderly person to be eligible for nursing home care, assisted living, adult foster care, or in-home care from Medicaid, they must have limited income and assets.
Less fortunately, these options are often confusing and difficult to implement without the expertise of a Medicaid planning professional.
An applicant is permitted to transfer up to $126,420 (in 2019) to their spouse, given their spouse is not also applying for long-term care Medicaid and will continue to live independently in the community.
The penalty period begins on the date that one becomes eligible for Medicaid, not the date that the transfer or gift resulting in penalization was made.
For example, if you transferred your home to your child on August, 5th, 2019, but didn’t become eligible for Medicaid until March 16th, 2018, your period of ineligibility will begin on March, 16th, 2018.
(This is called the penalty divisor or private pay rate, which increases each year with the increase in the cost of nursing home care). Example #1 The state in which you reside has an average monthly cost of $4,000 for nursing home care and you gifted $60,000 during the look-back period.
This means you will be ineligible for Medicaid for 15 months.Penalties come in the form of a period of time that the applicant is made ineligible for Medicaid.This means they will not be able to receive care services paid for by Medicaid for a certain number of months, or sometimes, even years.A Medicaid applicant is penalized if assets (money, homes, cars, artwork, etc.) were gifted, transferred, or sold for less than the fair market value.Even payments to a caregiver can be found in violation of the look-back period if done informally, meaning no written agreement has been made.Please note, asset transfers by the applicant’s spouse can also affect the applicant and can result in a Medicaid penalty period for the applicant.Tags: Adult Dating, affair dating, sex dating