My father passed away in January - literally of a broken heart (heart failure) - because two months prior we admitted my mom into a nursing home because she has advanced Alzheimer's. She requires 24/7 care - up until then my 74 yo father had been taking care of her...bathing her, feeding her, cleaning up after her, etc. Dad, and now me, pay the nursing home ($315 per day!!!) out of pocket, but Mom's liquid money is going to run out before July. I am her power of attorney, so I'm handling finances, and am aware I need to spend down her funds to $2k until she's eligible for Medicaid. We live in Iowa.
My father edited his will a few years back, purposefully leaving my mom out of it as an attempt to protect some money for his 3 children to inherit (opposed to being burned through rapidly to pay her nursing home fees). I am executor of his estate and have been working with the same attorney he used to amend his will. At the lawyer's guidance, I have been working on clearing out the house (trashing the bulk of it, keeping things of sentimental value, but ultimately trying to sell items of monetary value...like his two vehicles, which were in his name only, furniture, lawn care equipment, etc.) and prepping it for sale - as it was co-owned by my mom, its exempt from the will and her asset. It's my understanding that the goal here is to sell the home and use those assets to continue to pay for my Mom's nursing home fees, before becoming eligible and applying for Medicaid. My worry here is I won't sell it in time - and then what? Can I even apply for Medicaid while her home isn't selling ... will she be kicked out? I don't understand how that works - and no one (not my lawyer, not my case worker at her nursing home) seem to have a clear answer. The scary answer is I have to dip into the estate account - but that will just drain the money my dad had left to his kids.
My lawyer said the probate court will take 6 months to evaluate our situation - long after the money in Mom's account (formerly their joint account; separate from the savings acct Dad intended to go to his children and was only in his name) will run out - so again I just feel lost with no plan in motion. But his hope was that DHS would not "force my mom (but really me as her POA) to elect to go against the will" because she had the house (approximately $150k) and therefore the kids could keep the estate funds (approximately $100k once the cars are sold). That was our goal all these months.
Cut to last week when he informed me we needed to hire an attorney to represent my mom. As both her POA and a beneficiary of my dad's estate - I had a conflict of interest, and it would look better in the court/DHS' eyes if we hired an impartial 3rd party lawyer to represent my mom's best interest. That made sense to me.
Cut to today, when he had his assistant call me to schedule a conference call with me, my brothers, himself, and my mom's lawyer to discuss why my mom NEEDS to elect to go against the will.
I was taken aback - as you can imagine this has been a horrific year and unbearably painful in all regards - but now I worry my lawyer is crap and doesn't have any of our best interests in mind. I don't understand why he is making decisions like this, that go completely against everything we had talked about prior to today.
I just feel lost and overwhelmed - I don't even know if I have any concrete questions to pose. Maybe just hoping someone out there is experiencing something similar, and can offer a semblance of reassurance that things are as bleak as they appear?
- mom applied for LTC NH last Nov (Oct?). Dads follows usual set up for NH v CS spouse situations for Medicaid. Medicaid starts to process mom’s application, which tends to take 3-4/5 months. All good!
- Dad still alive & in the home and as such he was a CS (community spouse). One part of CS is that they need to delineate their assets & make them separate from NH spouse. Only mom needed to become impoverished at 2k max in assets. Not dad. That 100k was, I bet, $ moved to set up dads separate assets. Most states have this at abt $120-128k for CS. So if his $ move was 100k it falls under the max. He did a codicil to his will to leave the kids as beneficiaries. So far so good.
- the house, I bet, was owned by them both. But it exempt asset under Medicaid rules for mom whether she own it totally or it was both of them as owners. But it is subject to estate recovery aspect of Medicaid in some way when mom / dad dies. Dad stays living in the house. So far again so good.
- house can be sold but till that happens it’s exempt asset. If it had gotten sold, I bet 50% of $ from Act of Sale is moms and it would make her ineligible for Medicaid. So she’d go to private pay till she became impoverished once again. But dad keeps his 50% but has to make sure he doesn’t exceed CS max assets. He’d deal with this ‘21 or ‘22.
- then Dad dies. All the planning & $ move now as you said “is moot”.
- 100k needs to flow back to be hers as it came from a joint asset & whole CS aspect of Medicaid is gone. She will file new application once she’s impoverished.
- heirs of Dad find that codicil to his will has assets (the 100k) that cannot be distributed as per codicil as it was dependent on dad being a CS and surviving mom.
- to keep from looking like there is “self dealing” by dads Executor, your / dads probate atty realized that mom now needs her own atty to represent moms interest which is in conflict with changes dad did Nov - Jan.
- I’d suggest that you try to find out ASAP as to just who owner(s) of the house are.... like if it is entirely mom, so it’s all her new atty’s problem to deal with
OR
if it’s still co-owner w 50% mom & 50% dads estate. If house possible could sell for 150k, I’d say allow for 20/22k of that to go towards commissions, closing costs, etc. So how much after the outstanding mortgage would probably be actually left?
You as his anticipated Executor need to do your part to ensure his Estates 50%. You’ve done some of this by selling 1 of the cars & putting $ into estate account. I would clearly ask IF there may be an issue in your continuing to do things “executor”. If so, that means dads old atty ends up doing stuff but I bet it’s more than what his initial price was so will come out of the 50%. Ask. & get a document prepared ahead of time as to all costs you’ve paid to date and mileage (with dates) and tell dads atty that you fully expect to have this filed as an executor related expenses or a claim in probate. To me, you want to let him know that you cannot be running around, doing whatever for free. (( Unless of course you totally want to, but I’m of the opinion that you want to let attys know your not a go-fer and doormat, just sayin’))
My experience is most probate guys do NOT do litigation work & if that ends up happening, they will resign & turn it over to a probate atty that does litigation; they will cost significantly more. I’d try to clearly find this out soon & if so make it that all this should get paid from the estate (which has house as an asset). If the mortgage is still pretty big, there may not be any real $ left for dads 50%. It would be negative equity. Look at the math as you don’t want to be going / doing/ spending for nought (unless you really want to, of course).
I’ve been on this forum a long time & I think this is 1st time for this situation, so please let us know what happens, ok! Good luck.
Ok quick math ? 4 you, if house could be sold for the current / last tax assessor bill & assuming your folks were & r all current on taxes & current on mortgage, roughly how much $ would there be left less 8%? Has the Realtor run comps and given you a book on comps and what Realtor thinks it can sell for? I’d suggest that you talk w them to get a prospective listing price for it absolutely “As Is” & no warranty / no repairs. Is your real estate market currently with no or very little inventory? Ask Realtor as right now this is happening big time in some areas... it changes the dynamics of house buy/sell.
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is the mortgage holder aware that your dad has died? Or is it that the mo mortgage payment has been done & on time as in the past so they don’t really really know he’s died? Do you have the mortgage?
& from here on out, personally if it was me, I would NOT spend a penny on anything house or anything mom, let those get paid from that bank acct with the 100k in it. Sounds like your the total point person on all this (your the dutiful daughter, right?), & your out personally already maybe 1-2k between appliances, clean & organize stuff, if so, I’d do a list with matching receipts for everything you’ve bought so far. It does add up. This will show that you’ve been a good fiduciary just in case MedicAID or whichever atty or your siblings (or thier spouse) starts to question what you’ve done.
Do a time sheet too, as it might can be entered in MIE part of Executor costs to administer dads estate. MIE = (mileage + incidental expenses. Things do add up.... lightbulbs here, gallon of Fabuloso there, garbage bag$, driving to Lowe’s specifically to buy items for the house & yard.
IMO if he’s estate planning, it’s about asset retention, doing generation skip stuff, avoiding taxes & streamlining probate if need be. Estate planning is way different than planning for Medicaid filing & compliance which is more about legit & allowable use of whatever assets till impoverishment for NH spouse & applying for waivers for community spouse (CS) & securing max $ assets allowed for a CS (most states have this at $128k). How did y’all find this atty?
Where there reasons why mom didn’t file LTC Medicaid app when she entered NH last year &dad living at home as a community spouse?
What JoAnn asked on the timing of all this is critically important.
When were things done? Medicaid tends to look at anything before the lookback as being outside of consideration by the State. But things done within it can be subject to transfer penalty. If it’s quite recent, it looks like asset avoidance. If this is the case, the new atty representing your mom, well they may have to attempt to recapture the 100k to become an asset of hers so she has funds to private pay & not apply for Medicaid (as she’d be found ineligible due to dad doing asset transfer). Also she’s right that this needs to be primarily an atty-2-atty conversation on subjects regarding mom; to me the CC is basically going to b a warning call to the kids. And it’s btw atty & Executor regarding dads estate. Heirs get a notification as per filed will but till distribution done, it’s not their place for input. Unless they litigate.
I’d be also concerned about if you are personally paying $315 daily (9K+ a mo) for moms room&board &/or paying for property costs AND you are expecting to be reimbursed fully. My experience is Medicaid tends to view whatever family does or buys for elder is done out of a sense of familial responsibility and done for free or without compensation. To get around this, there would be some sort of Personal Care Agreement with taxes done or a notarized & witnessed Memo of Understanding (or Promissory Note) that you are to be repaid from assets or from the Estate; and their done way in advance. Your mom has some income, like mo SS income, she needs to be paying her costs at NH first & foremost. Not you paying $315 a day.
On the property, how things are determined will be based on your state’s administrative code as to how Medicaid is run. Medicaid knows it could take time for a property to sell. What seems to be is that as long as it is on the market, with a Realtor & MLS listing (so no FSBO nonsense) at FMV then elder can be on Medicaid but once house sold Medicaid is probably going to want to be repaid for all costs to date; and if $ left it all goes towards private pay at the NH. As property is your moms, all $ from the sale is hers & recorded in some way in State database. Her atty I would think is now the point person for finding out the exact info for Medicaid compliance now. You need to ask her atty as to if reimbursement for things you’ve paid for is feasible. It can look like “gifting” and gifting is not allowed by Medicaid. Her atty may now need to b in the loop on all expenses paid on the property & listing agreement. Ask at the CC. Good luck.
My dad had applied for medicaid for my mother when they entered her into the nursing home ... but my case worker at the nursing home told me it was all moot upon his passing. Because it's an entirely different process / set of rules for a married spouse v a widow. She had only been there two months when he passed...so it just didn't get processed in time.
I do not know how my dad chose this attorney, but his areas of practice include: Estate Planning (Wills, Trusts, Power of Attorneys, Living Wills), Probate Law - that are the fields that seem applicable anyhow.
I'm now pretty worried about timing - I honestly think at the guidance of his case worker, he was trying to divide their assets in a way that would make my mom eligible for Medicaid. So almost certainly very recently. I suspect you're right - the call is going to be a sorry kids, you're losing every thing. Because neither my lawyer or his assistant would give me a straight answer as to why it was necessary for my brothers to attend or why suddenly having my mom elect to go against the will was a certainty. This sucks. I've literally spent hundreds of hours clearing out the house, photographing items, posting online, showing items to perspective buyers - and for what? So DHS can take it all. Should I just stop - I mean really, what am I doing this all for if it's not for me and my brothers. I honestly feel like I should just and let DHS deal with the stuff, the house, everything.
I'm not paying out of MY pocket - I am paying out of my Mom's savings account - but we're down to about 20k so 2 more months at her nursing home, realistically. There were things I was paying for out of pocket when my dad was hospitalized before his death ... but nothing major, maybe $1000 in total (phone bill, cable, utilities - things like that). I did ask my lawyer if I could be reimbursed, but he said we need to wait - and pay people back in the right order. So I suppose that means no, assuming what I'm now assuming.
I've been keeping a list of all incoming and outgoing money to both my Mom's and the Estate accounts ... so like you said, she gets SS, a pension from my dad's employer, but she also has the mortgage, utilities, pharmacy expenses. Per my realtor, I did purchase a new dish washer, hired a plumber to fix some issues, and a handyman to fix up the place a bit. Sounds like I should NOT have done any of that? My lawyer only said to ask my realtor, so that's what I did. The house isn't on the market yet though - still prepping it for ready to sell status.
This is such a mess. I just miss my dad. And my Mom because she's not really my Mom anymore. And my brothers are no help - I am doing everything myself. It's like having two full time jobs, I spend so much time on this. And I just feel like it's never ending.
The house is an exempt asset. I would question the car sales though. Maybe in Dads name but maybe also considered a marital asset so half the money maybe hers. I also may also not worry about selling the house until probate is done. It has to be sold at Market Value per Medicaid.
IMO, Your lawyer should be discussing anything concerning Mom with her lawyer alone. Then her lawyer can talk to her representative, POA. I would think that your lawyer could only discuss things with the Executor. Beneficiaries don't get involved in decision making. They can contest when the final accounting is sent to them for signing. I don't know how she can contest a will when she is not competent to do so. And by contesting, it will take ages to get thru probate.
You do have a mess. Her lawyer should know his Medicaid and how applying for it is going to effect Mom with this Will. But, I would first talk to a caseworker and see what you are up against. Then talk to Moms lawyer.
Don't take what I have said to heart. They were ramblings just to give you some insight on what could happen. What Medicaid looks for. You are going to need 5 years of bank statements. Less in some States. Every State Medicaid laws differ. You need to know how this Will will effect Mom in getting Medicaid.
I was told by my lawyer, my mom's nursing home case worker, and even my rep at Veterans Affairs (my dad was a vet) that I CAN'T apply for Medicaid until my Mom's money is down to $2k. Are you suggesting I reach out direct to someone at Medicaid because that's simply not true?
Regarding the cars - my lawyer told me to put the sale money into the Estate account, so that's what I have done (sold 1 car so far)....as well as money from all other sold property.