Many baby boomers are Medicaid recipients.  They are also homeowners.  Some are considered “house poor” because they have no money in the bank, their homes are not in the best of conditions, and they cannot afford the cost of maintaining their homes.  Moreover, some cannot sell their homes because the cost of losing their Medicaid benefits is too great.

Is there a solution to this catch-22?  The answer is yes.

The American Council on Aging has a wonderful article on this particular subject.  I’ll quickly summarize it for you.

1. Medicaid is the government program, run by individual states, to cover the expenses of caring for a person (elderly adults, people with disabilities, and low-income individuals).  However, it wants you to spend all your available funds before it kicks in.

2.  Medicaid has a 5-year lookback period.  It will review any asset transfers you have done in the past and review them for possible asset-hiding.

3.  The home a Medicaid recipient lives in is considered a non-asset when each particular asset is considered.  Liquid assets count towards the limits imposed by each state.  Usually, states impose asset maximums and monthly income maximums in order to qualify for benefits.  In Florida, for example, the monthly income limit depends on whether you are single or married, and type of benefits received. (Click here)   Moreover…While one’s home is generally exempt from Medicaid’s asset limit, it is not exempt from Medicaid’s estate recovery program. Following a long-term care Medicaid beneficiary’s death, Florida’s Medicaid agency attempts reimbursement of care costs through whatever estate of the deceased still remains. This is often the home owned by the decedent. Without proper planning strategies in place, the home will be used to reimburse Medicaid for providing care rather than going to family as inheritance, which is another reason to consult an elder care attorney.

4.  Once you sell your house and the money comes into your account, without sufficient planning, your benefits could be lost with Medicaid.  Depending on your health needs, this could be financially devastating.

If you are in this situation or your parent is, please reach out to me.  I have experience in this very important segment of the population but not all agents are.  If you fail to plan properly, all your parents worked for could be placed at risk.   #familytrusts #medicaidbenefits #miamirealestate #riskyselling