10/15/2024
Medicaid Myth:
Many people think that they'll automatically lose their house if they have to go into a nursing home and apply for Medicaid (Medical Assistance). This is not exactly correct, but the devil is in the details.
When someone applies for Medicaid, they're only allowed a limited amount of assets, the actual limit depends on many factors. The primary residence does not count towards this limit. That being said, in the case of a single person, almost all of their income goes towards their costs of care, so there are not available funds long-term to pay for things like taxes and utilities. Additionally, the house is subject to estate recovery, which means that once the individual passes away, a lien can be placed on their estate so that funds provided can be recouped. So while they house isn't immediately taken, the estate might not get any value from the house.
That being said, the situation isn't hopeless. Attorneys familiar with Medicaid, elder law and estate recovery can present some options such as legal exceptions to transfer the house, spousal transfers if the person is married, trusts to protect the house or utilizing partial transfers to get some value from the house.
This is one of the topics where I see the most misinformation or misunderstanding, and what might've worked for someone's neighbor may might not be the best approach for the next person and their situation.
There are definitely pitfalls when the wrong approach is taken, so I'd highly recommend speaking to an attorney familiar with this area of law before taking action. If anyone has questions about this topic, please use the call now button to discuss your particular situation.
