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I agree with you sister married at age 17, she was pregnant to her high school sweetheart. Six years later with 2 kids in tow, sis divorces husband because he is a druggie. They did manage to buy a modest 3 bdrm home that sis was awarded in the divorce.. She immediately got tied up with a man 13 years older than she who live 4 doors down from her. They dated for 2 years before getting married. He made lots of money, they moved 45 minutes drive from here and bought a large home with a large yard, nicely landscaped with a deck and sunken above ground pool. Within one week of their fairy tale marriage, he started beating my sister. We knew nothing about this since they lived 40 miles away and sis threatened her daughters not to tell us. Sis was taken to emergency a few times because of his beatings. After my sis's first divorce, she got foodstamps and some monetary help for babysitting services so she could work. After sis's second divorce, she refused to go on foodstamps again, she again was awarded the big house in the divorce. She did not work during the 6 years of marriage to her second husband. Now she had to find a job, she was renting out the modest 3 bdrm home here in town. She decided to sell the modest home, keeping the larger home. She lived on the money from the sale of the house while she went to school for computers, which she ended up not finishing the program, instead she got a job in an office She also had a second income working as the bookkeeper for the campaign manager of the congressman for our district. She lost the second income when the congressman retired from politics in the early 90's. Her job has a retirement pension and health insurance. Now upon the second marriage failing, sis was now an alcoholic, she immediately got tied up with another man around 11 years older than she, he also was making good money, had received a large inheritance from his aunt. In the meantime, my sis is also getting a lot of monetary help from my parents. Sis and her current man, manage to go on many weekend trips staying in very nice hotels in the Lake Tahoe area, Half Moon Bay. Whenever sis needed work done at her home, such as re-landscaping, painting the inside of the house, she would make it a party, supply the food and drinks while the men did the bulk of the work. Sis continued to see this man for 15 years before she got tired of his antics, turned out he was schizophrenic. By this time, all sis's friends have faded into the sunset, she now needs to replace the pool in the backyard, needs a new roof. My dad is getting older he can't do the work for her. She refinances her house to get this done because maintaining this large house and yard is expensive. Sis now alone, her daughters are grown and moved away. She continues drinking until her health went downhill in 2008. She now has stage 4 diabetes, low blood pressure which limits her activity. She is 5 years from retirement and her house is still not paid for because of refinancing twice. She is paying for a lot of bad choices and how she will manage when she retires...I don't know.
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I'm really torn on this issue. My mother, at this point, has a very substantial estate. If she has to go into a nursing home long term, depending on the costs, I'm not sure how long that will last. She would not qualify for Medicaid and does not have long term care insurance. I'm going to do my best to keep her at home as long as possible both because that's where she wants to be and because that's where we can best preserve that estate.

On Medicaid, I think there should be a 3rd family listed. There's a girl that gets pregnant in high school. She has her kid, gets a job at the mall, or a fast food place, maybe if she's lucky in an office somewhere. She gets minimal if any help from the yutz that got her pregnant. She struggles to put food on the table and shelter over their heads. At some point, she ends up with another kid or 3. Maybe she even gets married and divorced a couple times and gets more than minimum wage. Maybe she gets up to $30K a year with 3 or 4 kids. I used to see it all the time. She can't put any money in savings. She can't go on any vacations at all. God forbid one of the kids gets sick because she can't afford health care. Retirement? She's just trying to survive. That is who Medicaid is for, really - the poor, struggling people.
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I must add, that the $50,000 my mom spent...most was because of the mandatory yearly withdrawal from the IRA.
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I have to agree with you and this why....My parents both worked full time, high school educations...they had 4 children. With both parents working, the most they made together was $35,000 a year. They owned their home, my mom worked for a bank so she stashed money away in T-bills and an IRA. Dad worked for a family owned hardware store. His boss was very smart...he had profit sharings for the employees and money was invested by Merrill Lynch. My dads retirement portfolio was much larger than mom's even though the bank invested money in their own stocks. I am 55 years old, while growing up, we did not have a color TV until I was 10 years old, central air was added to the house when I was a teen. Wall to wall carpeting was added when I was 13. I am the youngest of 4, and was the only child living at home when I was 12. My parents scrimped and saved, live frugally all those years. We had one vehicle until after I was married and out of the house. My dad bought a truck that was used. He knew many almond farmers in the area and made contact with them to cut up down trees for firewood in the fireplace. Our family vacations consisted of tent camping in the mountains for a week once a year and mom would make spaghetti sauce in advance to freeze to take with us plus my dad and brothers were avid trout fisher's so we ate lots of fresh trout during that week. You get the picture.

When dad developed Alzheimer's Disease, mom found out about an Elder Law Attorney the Alzheimer's Aids Society recommended. She went to see him. He set up a living trust for the house, and when dad was diagnosed as mentally incapacitated, he and mom went to court. Everything was put in mom's name so that medicare could not come after her for repayment when dad passed away. So basically it was hidden. The reason the attorney did this was so mom had money to live on and still have a life even though dad was now in a nursing home that medicare was paying for.Dad passed in 2003, from 2003 to 2012, mom had only spent $50,000 of the hidden money for her needs and living expenses because she was budgeting on getting by on her SS which amounted to $1,300 a month!! In answer to your question, I see nothing wrong with this because it allowed my mom to live as she was accustomed to living frugally. Medicare did try to come after her for about 3 years after dad passed, but my daughter sent an email to our Congressman about the situation and he stopped Medicare from harassing my mom on a yearly basis for records regarding dads care,etc. Without my mom's attorney doing things this way, my mom would have lost everything, and she would have had to rely even more on social services ( the tax payers) for her livelihood. I believe it is right and just. My mom is now 84 years old, is mentally incapacitated due to Alzheimer's Disease.and is living in a memory care unit. Mom had the foresight to take out a Long Term Health Care Policy because 3 of her siblings developed Alzheimer's. This policy is currently paying for her care and will continue to pay for 4 years. Because of drugs like Namenda and Aricept used together, mom will most likely live longer than dad did once he was placed in a NH, when the LTC policy runs out, she will have the money from my dad's employer that was invested with Merrill Lynch to continue to pay for her care. Is it fair, YES...she is footing the majority of the costs not social services but if the money was not hidden, social services would be footing all of it. Not all will agree with me but really, family B got more services from social services than my mom did or will in the end.
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(continued from Part A, above)

... Dad B lives in a small apartment, and covers the rent with his small pension and Social Security income, but these are nowhere near sufficient to cover the monthly costs of the care he now needs, and may require for years. Since he and Mom B has never sacrificed to save anything, Dad B has very little to show in assets for his years of earning.

Family B applies for Medicaid and sets up a Miller Trust to satisfy Medicaid that whatever income Dad B DOES have will go to his care, and presto! The bulk of the cost of Dad B’s care is immediately and hereafter funded by taxpayers. Who do not, on the whole, call Family B “cheaters” for applying for public assistance to pay the outrageous cost of memory care, since, after all, Dad B is “needy,” and Family B didn’t try to “stick it to the taxpayers” by shielding any money that could have gone to Dad’s care (at least, not within the last 5 years ... and I guess we’ll all just agree to turn a blind eye to the previous 50).

In Family A, on the other hand, there ARE savings – not savings that have somehow magically rained down on the family as lottery winnings, or capital gains from a lucky investment, but that have been painfully built through literally DECADES of sweat, scrimping, self-denial, and significant sacrifice. To Family A -- which has postponed or entirely given up nearly every one of the everyday luxuries that Family B consumed with mindless joy for the past 50 YEARS – Medicaid now demands that the family spend every dime Mom and Dad ever saved before it will offer even the first penny in help.

What’s more, if anyone in Family A even dares to ask if there’s any way to hold onto a little of what Mom and Dad gave up so much to build, many people now say, “How dare you ask that! It is evil and immoral for you to try to ‘protect’ any of your parent’s nest egg before asking us for help! Our help is only for people who really need it! Like that nice man over there from Family B! Anything you try to do to shield even a tiny bit of what you’ve saved so that it goes to the family you saved it FOR is CHEATING, you evil, cheating CHEATER!”

This may sound like an exaggerated scenario, but I have seen it personally – and it is why I don’t find the question of whether shielding assets is “moral” or not to be as cut-and-dry as others seem to. I’ve painted an unpleasant picture of Family B here ... but did they really do anything wrong? Don’t we all have the right to spend and enjoy what we earn? But if so, given all that Family A gave up to hold onto that money, do we really have a moral right to demand that they sign over to a nursing home everything they sacrificed to save for their children before we will give them the same assistance we immediately give to Family B, which never sacrificed anything (and is not now being called upon to make up even a little of what they spent over the years before we agree to step in and carry the burden for them)?

Remember, both families are also taxpayers, and have poured an enormous amount of tax money into the system over their lives. Remember, too, that Medicaid does not provide for a particularly luxurious life style or high level of care or comfort ... if you can afford to pay for better care, it is nice to be able to do so.

Wonderful poster JeanneGibbs (we miss you, Jeanne!) once posted on a similar thread that “fair” and “unfair” had little to do with health care issues. She was absolutely right. But I’m starting this thread because I’m curious to know how other people see this ... and if anyone else agrees that the question of whether it’s right or wrong for people to try to protect assets maybe isn’t as black and white as it might seem on first glance?

I think we have a tendency in this country to resent other people’s “wealth” (which I use here simply to mean whatever someone has that is more than we have). It’s human nature to tend to assume that someone who has more than we do must have just been luckier rather than to consider that they might have worked just as hard as we do, and then denied themselves in order to save the money for later ...

Anyway, thanks in advance for your responses. I'm interested to hear what other people think.
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