Protecting Your House Before and After Moving Into A Nursing Home

Protecting the family home is one of the biggest issues that people worry about when discussing Medicaid eligibility. Let’s look at some of the basics:

While you generally don’t have to sell your home in order to qualify for Medicaid coverage of nursing home care, it is possible the state can file a claim against your house after you die, so you may want to take steps to protect your house.

If you get help from Medicaid to pay for the nursing home, the state must attempt to recoup from your estate whatever benefits it paid for your care. This is called “estate recovery,” and given the rules for Medicaid eligibility, the only property of substantial value that a Medicaid recipient is likely to own at death is his or her home.

If you contact our office in a timely manner, we will be able to conduct Medicaid planning to protect your ability to receive care and your estate. If you don’t have an opportunity to conduct Medicaid planning in advance, call the office before entering a nursing home or as soon as possible after entering the facility.

Transferring your house to your children (or someone else) may lead to a Medicaid penalty period, which would make you ineligible for Medicaid for a period of time. There are circumstances in which it is legal to transfer a house, however, so call our office before making any transfers. If you sell your house for fair market value, it may make you ineligible for Medicaid and you may have to apply the proceeds of the sale to your nursing home bills.

Lien on Home
Except in certain circumstances, Medicaid may put a lien on your house for the amount of money spent on your care. If the property is sold while you are still living, you would have to satisfy the lien by paying back the state. The exceptions to this rule are cases where a spouse, a disabled or blind child, a child under age 21, or a sibling with an equity interest in the house is living there.

Estate Recovery
If your spouse, a disabled or blind child, a child under age 21, or a sibling with an equity interest in the house, lives in the house, the state cannot file a claim against the house for reimbursement of Medicaid nursing home expenses. However, once your spouse or dependent relative dies or moves out, the state can try to collect. But there are some circumstances under which the value of a house can be protected from Medicaid recovery. Contact our office if you have questions about this or related matters.