The Elder Law Minute TM
Protecting One’s Home When Applying for Medicaid
BY RONALD A. FATOULLAH,
ESQ. AND JOSEPH BRENINGSTALL
ELDER LAW
THE ART OF ELDER LAW
For more than 30 years the elder law firm of Ronald Fatoullah & Associates has been providing
New Yorkers with legal solutions that protect, relieve and endure for generations.
Our dedicated attorneys are skilled in the art of giving legal advice and are accomplished in
elder law, Medicaid eligibility, estate planning, trusts, estate mediation, wills, asset protection,
guardianships, probate and most issues associated with the challenges of aging.
Our distinguished reputation is based on a commitment to the highest ethical and professional
standards and our core values of honesty, integrity, and excellence.
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One of the more common misconceptions
regarding Medicaid eligibility is that
in order to qualify for Medicaid long term
care benefits, applicants must sell their
homes and spend down their assets until
they are below the asset limit of $15,150
for a single person or $22,000 for a married
couple, where both spouses are applying.
This misconception strikes fear in the
hearts of applicants and their family members
for several reasons. Firstly, for many
applicants the equity that they have built in
their home is their most significant asset,
and they have a difficult time coming to
terms with the fact that they may lose this.
Secondly, many applicants have other family
members who live in the home with
them, and they or the family members
residing with them are afraid of being displaced.
This specific fear has led to several
recent cases of grave elder abuse wherein
family members living with seniors prevented
them from getting the care they
required out of fear of losing their residence.
This article seeks to put these misconceptions
to rest, and suggests a variety of
solutions that would allow seniors and
their family members to plan for their care
without fear of losing their home.
The Federal Medicaid guidelines state
that as long as a nursing home resident
intends to return home, the home will
never be considered a countable asset for
Medicaid eligibility purposes. On a federal
level, and according to most state guidelines,
it is enough that the resident has a
subjective intent to return home no matter
how slim the chance of that actually
happening may be. Some states, however,
require that there be at least an objective
possibility of the resident returning
home in order for the home to be exempt.
Although some states may place a lien on a
home even if a statement of intent to return
has been filed, the lien will be removed if
the resident ultimately returns home. In
any case, a lien will only prevent the applicant’s
estate from selling the home without
Medicaid recovering the funds expended
for the applicants care; it will not displace
other family members who are currently
residing in the home as long as the resident
is still living.
There are, however, many other options
available to a homeowner who is applying
for Medicaid other than a statement
of intent to return. Transfers to a spouse,
a child under the age of 21, and a child
who is certified blind or permanently disabled,
and transfers into a trust for the sole
benefit of a disabled individual under age
65 (this can even include the applicants
themselves in certain circumstances) will
be considered exempt transfers and will
not be subject to the traditional five-year
lookback rule. Additionally, transfers to a
sibling who has resided in the home for
more than one year and is contributing to
the equity, maintenance or upkeep of the
home are exempt as well. Finally, transfers
to a “caretaker child,” meaning a child of
the applicant who has lived in the house for
at least two years prior to the applicant’s
entering the long term care facility, and
who during that period provided care that
allowed the applicant to avoid entering the
facility, are also exempt. These exemptions
will often apply in the situation described
above, and may prevent the home from
being included as a countable asset.
The foregoing options are best applied
in emergency situations when there has not
been time for advance planning; however,
it is a wise idea for seniors to consult with
an elder law practitioner to explore the
many ways in which they can act preemptively
to protect their assets while remaining
eligible for Medicaid.
Ronald A. Fatoullah, Esq. is the founder
of Ronald Fatoullah & Associates, a law
firm that concentrates in elder law, estate
planning, Medicaid planning, guardianships,
estate administration, trusts, wills,
and real estate. Joseph Breningstall is a
law clerk with the firm. The law firm can
be reached at 718-261-1700, 516-466-
4422, or toll-free at 1-877-ELDER-LAW
or 1-877-ESTATES. Mr. Fatoullah is also
a partner with Advice Period, a wealth
management firm that provides a continuum
of financial and investment advice for
individuals and businesses, and he can be
reached at 424-256-7273.
RONALD FATOULLAH
ESQ, CELA*
1-877- ELDER LAW
1-877-ESTATES
Queens • Long Island • Manhattan • Brooklyn
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