Medicaid recipient (LTC) and charitable donations. Anyone have experience with this?
I'm well aware of the no-no of gifting as a spend-down strategy during the Medicaid look-back period, but have a question about gifting once a person is already on LTC Medicaid. My brother-in-law had a change in assets because he and his other two brothers sold a small piece of property two years ago. My husband was POA for his brother and let our state's Medicaid program know right away and asked how they wanted to handle it, e.g., suspend Medicaid for a couple of months and private pay to spend this down, or keep him on the books and repay for what had already been spent? Because there was some sort of temporary suspension of eligibility review under federal COVID guidelines, the caseworker said not to worry about the extra assets for now. But, it's been 2 years and we still haven't heard anything, even though my brother-in-law has had two annual reviews since this money came in and it is always listed under his assets. I'm pretty sure some of the extra $$ could be spent on his behalf (e.g., for a computer or tablet, clothing, etc.). What he is wondering about is whether he could make any charitable donation with some of the money, and if so, what the limit might be? He would like to donate to his church, and tithed before he went on Medicaid and could no longer afford to do so. I suspect the same rules would apply to this "new" money as applied to his assets before going on Medicaid, i.e., no gifting allowed. How about small gifts to nieces and nephews?
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I would however suggest that he spends all his PNA (personal needs allowance) each & every month. Even if it means you now have shelves of toiletries and clothing replacement for him in your home. Here’s why: he is allowed to have non-exempt assets. Most states have this at 2K max. Plus he gets to keep a part of his monthly income as the PNA. Most states have this at $50 or $60 a mo. @ $50mo that’s a max of $ 2,600 a yr of assets possibly for him. Spend it down so he’s got very little in nonexempt assets so that if & when the caseworker finally gets around reviewing to the real estate windfall % of his, they can let him keep $2K and the rest gets a spend down unless he can give to a charity.
Emergency situations happen. When Hurricane Katrina hit, my MIL New Orleans NH move en masse to Houston. She was on LA LTC Medicaid as were most. A lot still owned a home & several had extended family living in it. All fine by LA Medicaid. TX Medicaid took all in & went onto TX LTC Medicaid. Minimal questions asked. Around 6-8 months later all got letters from TX Medicaid asking for details as to their prior situation in Louisiana. A few months after that, those that had homes back in LA got letters as to their change in eligibility. That home or property in LA was now a nonexempt asset so they were ineligible. Some were partial owners of a home (their kids or a sibling owned the other part) but still had % ownership and it too was now a nonexempt asset. TX Medicaid did a property search to look for name match-ups & sent letters out to those properties to ask clarification as to ownership and if insurance proceeds paid. Their choices were stark, if they wanted to keep the home they had to find a NH somewhere in LA to go to; if they wanted to stay in TX the old home had to be placed up for sale & sold at FMV, rotflmao. If insurance proceeds were paid & not fully spent on property, it was income, so ineligible. It was awful as most had homes flooded unliveable, their family tended to be themselves displaced; you could not get repairs done much less sell. All this to ferret out ineligiblity based on events that happened in basically a 2 week period the year b4. But TX Medicaid did it. My point is Covid is way way bigger situation. I cannot imagine the backlog. But eventually things will surface. Let the $ sit at the bank imo.
Since COVID many review dates were just bumped to the future without any real review. I know they did it in Texas so other states may have used the same process.
Its possible an elder atty can put the money into a trust for future needs for brotherinlaw. There may come a time he needs more specialized equipment than NH will provide. ie more comfortable wheel chair, better mattress, someone to sit with him. I would definitely check into trust
Covid, though we did have to submit information each year for the annual review and recertification. Because Maine is so generous in allowable assets ($10,000 total), there would actually be enough to cover at least some future needs for specialized equipment, etc. even without the extra land sale $$ that the state's Medicaid program still hasn't told us what to do with. We did use some of it to pay for OT at the nursing home that was not covered by Medicaid, but which was very helpful, and also for dental and optometrist visits.
Question to newbiewife/anyone: are "Assets" the same as "Resources?" Where I live, they look at 2 things for Medicaid LTC: what they call "Income" and then "Resources." Thanks for posing this question. Lots of good information in this thread.
The stimulus check was the only thing that could be given to a charity.