Courtesy of Deb Miller
JD WVSLA volunteer
"I know I will lose my house if I go into a nursing home on Medicaid" is something many believe will happen.
Planning ahead can help avoid that result while also assuring that you receive the nursing home care that you need. While long-term care Medicaid is a complex area of the law, it is also an important source of benefits for a large number of older West Virginians.
Owning a home does not keep you from being eligible for long-term care Medicaid coverage. Currently, you may have equity in your home up to $585,000, a car, irrevocable prepaid burial plan, personal property and $2,000 in an account, and still be eligible to have Medicaid pay for your nursing home expenses.
Many facing the nursing home decision think that if they give away their house to their children or add their children's name to the property deed while they continue to live there, they will be fine. The opposite can be true.
The reason why is that when the forms for Medicaid eligibility for nursing home care are filled out, you must provide a listing of property and other assets you own now and any transfer of assets you made within the previous five years, including those you didn't receive full compensation for.
If you gave your home or partial ownership in it to your children or any others within that five years, there will be a period of ineligibility for coverage. In Medicaid lingo, that gift of your home causes an uncompensated transfer of assets penalty.
The penalty is losing out on coverage of the nursing home expense for a period of time, based on a formula, equal to the value of the property given away.
Unfortunately, your attempt to avoid the loss of your home through giving it away beforehand leads to a loss of Medicaid coverage.
Another aspect of the Medicaid rules that can affect your home is Medicaid estate recovery. After your death, the state has the legal right to recover the amount of the expenses paid from the assets you owned on the date of death, but actually that is rare. The recovery occurs through the placement of a lien on the property, but there are multiple exceptions.
If your spouse or a dependent or handicapped child is still living in the home, it is protected. There are other exceptions that also apply.
There is one simple option, available since 2014, that can make a big difference. Consult with an attorney about preparing a transfer on death deed to avoid probate of the property. The deed doesn't change anything about your current ownership but does list the after-death recipients. The transfer on death wording allows the property to pass to heirs, not be in your probate estate and not be subject to Medicaid estate recovery.
Medicaid coverage for nursing home care is a complex area of the law, and reaching out to learn more is important.
Get the help you need from a West Virginia Senior Legal Aid lawyer at 800-229-5068. If you are a West Virginia resident at least 60 years old, you can call with questions about your house and Medicaid eligibility or other legal concerns.
Senior Legal Aid respects the autonomy of individuals, so the senior must call for himself or herself.
For those who plan ahead, there are choices on how to accomplish their goals for the future.