I took a call yesterday from a woman in New Orleans who had been living with her parents and taking care of them for more than 20 years. She said her parents were about out of funds and were about to move into the nursing home and apply for long term care Medicaid.
The daughter wanted to know if the parents could transfer their home to the daughter and still be eligible for Medicaid. My initial comments were, "No, you're stuck. Your parents can qualify for Medicaid but when they die, estate recovery laws require Medicaid to get reimbursed from your parents estate for the moeny spend on your parents' care." If her parents were to transfer the home, it would make them ineligible for Medicaid for as long as five years.
But I asked a few more questions and realized they might qualify for an exception to the transfer of asset penalties. In Louisiana, a parent can transfer the parent's home to a child without penalty if the child is:
- 21 or older;
- is not blind or permanently and totally disabled;
- was residing in the home for at least two years immediately before the date the individual became institutionalized; and
- provided care to the individual to reside at home, rather than in an institution.
This exception must be documented by a written physician's statement.
If you have questions regarding how to protect your family's assets from the rising cost of long term care and nursing homes, send me an email at paul@rabalaislaw.com. We've helped many save their life savings by taking advantage of smart Medicaid eligibility planning. I look forward to hearing from you.
Paul Rabalais
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