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Hello. My mom (88yrs) has been receiving Medicare and Medicaid for many years. Her only income is her Social Security check of $675/month. She has no other assets. She has been living with me (her son) and my family for over 20yrs, since my father passed away. In the last 5 years, she's been deteriorating quickly with Alzheimer's and now needs full-time supervision and care. Her monthly social security checks land in a bank account that we share, but that I don't regularly use. Because she has been living with me all this time, I've just been covering all her expenses from my other accounts. This has led to a buildup of money in our shared account (now about $25K, which I always considered my savings, given that I've paid for everything from my other family accounts. We just started the process to possibly move her to a nursing home when the issue of "assets" came up. When I innocently disclosed that we "share" an account that has $25K in it, this has trigged the "Client is over assets and failing for Medicaid" letter. The letter wants us the send a "spend down/distribution" via mail or fax in the next 6 days. What can I do to save her Medicaid coverage this quickly? I'm getting mixed messages in what I read, particularly because we aren't applying to Medicaid, she already has it (for the moment). THANK YOU in ADVANCE.

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Because you have done this ALL WRONG you are in trouble here now, and honestly this serves as a warning to others, for marrying assets in this way will lead to this inevitable trouble. That is, I know, little comfort to you now.

You should have been POA for your Mother, or guardian or conservator as she became too incompetent to appoint you as POA. You would have been on her account only as her POA, and signing as such. All funds in the account would have been hers, and your own accounts were for your own assets, whatever you chose to do with them.
Instead you added yourself to her accounts. You are now without records to prove much of anything to anyone I would imagine, and "your word of honor" doesn't count whatsoever in these complicated legal matters.

You need the help of an Elder Law Attorney at once. There's one unhappy way to start spending down this money now. But this isn't DIY and this isn't something we can "help you" to do. This is governmental rules, and they apply. It's complicated at the get-go, and now with this mess over the years it is impossibly complicated.
As they say "ignorance is no excuse before the law". Your best chance of getting this cleared up is with legal help.

I am so very sorry, but this is what happens when one proceeds over time without doing it right, and the fact that it wasn't caught by the government before now just shows how backlogged they are. My friend who died a year ago never paid taxes the last 8 years of her life. They never caught her before she died, but it certainly has left a mess for the administrator of her estate, and for attorneys trying to wind it all down, and has robbed any inheritors of money they might otherwise have got.
Sad when these things happen, and I am, again, so sorry.

See an attorney now.
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fkts99 Feb 23, 2024
Thank you for you reply. For whatever its worth, I do have POA since last year. Not sure if that changes anything?
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You may want to contact a Medicaid Planner for your home state or an elder law/estate planning attorney who is familiar with Medicaid (because they all aren't).

Also, you DO need to provide Medicaid with the info they request in the timeframe they told you.
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You do need further advice but I will just say that although it seems unfair that is her money. You chose to take on expenses for her. That is the viewpoint of the government. I am not trying to be insensitive. Everything with Medicaid is very black and white. There are no shades of grey.

Perhaps you will get better advice from a lawyer. I am just telling you that it will be easier to come to terms if you realize that in their eyes her social security money is hers and cannot be shared. I am sorry for your predicament and I hope you find some resolution. I lost my mother last year and the one or two times I had to deal with social security for her they made it quite difficult.
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Dupedwife Feb 23, 2024
Riverdale: You are correct. My daughter works for Medicaid in the state where we’re from and Medicaid does want to see the financial documents and what was spent and what it was spent on. People have to understand that Medicaid is federal and state funded, and states try to recoup this taxpayers-funded money so the program can continue for others who will need it in the future. The OP should indeed speak to an elder law attorney for advice on this matter.
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You can't save money like that in a bank account when a person is on Medicaid. You are going to have to consult with a elder care attorney to untangle this mess you created because you did not know the Medicaid rules.
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I am with Alva here, you did it all wrong.

You should never co-mingleing a parents income with your own. Her SS should always have been kept in separate banking account. You should have used her money for all her needs. Her bank statement would have shown her money going in and out. Any account with her name on it, Medicaid determines is hers. Especially if her SS is being deposited in it. (My Moms name was on my disabled nephews acct when she went to redo her Will at 80. The lawyer told her to get it removed because of Medicaid)

Can you prove you have been covering her expenses and have just allowed her SS to sit? I think I would find a Medicaid planner first. An Elder Lawyer can help. I would suggest though, if he asks for a retainer, that you use the money in the acct Moms SS is deposited to. That will help to spend down her money. The lawyer can verify if I am correct.

If she is getting Medicaid for health insurance this amt of money can effect it. Community Medicaid where she is getting help with aides has an asset limit so 25k will mean the Medicaid will stop till she spends down the money.

I suggest you contact the caseworker on the letter and ask if you can set up an appt with them because you are confused about what you need to do. Take the bankstatement and check register with u. I so hope you kept records on what money you spent on her. You may be able to use that to offset the 25k.

Medicare has nothing to do with this. Medicare is tied to Social Security.
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Right now, mom has Community Medicaid.

She is now applying for Long Term Care Medicaid, which has much stricter financial qualifications. You need a certified Elder Law attorney or Medicaid Planner asap.
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Good example as to why you never pay for home care expenses for someone else with your own funds. Always use the LO funds, then when they run out, then you can apply for Medicaid.
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My advice to you is to seek the advice of an elder law attorney who has experience with Medicaid to help you navigate this problem. Your mother will definitely have to do a spend down on the money she has in her account and the elder law attorney will explain and advise you on how she should go about doing this as she cannot go about spending down the money on any and everything.
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Don’t overlook the possibility that this is a scam. Don’t provide money or financial details over the internet, just in case.
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Your mother can set up irrevocable trusts for her children and their spouses for prepaid funerals. That would help her spend down her assets significantly. Look into that.

You need to go to a funeral home that does this and you need to pay right away using bank checks so the money is immediately taken from the account.

You and your siblings and spouses will need to provide birth and marriage certificates.

If she doesn’t have a funeral trust set one up for her.

not sure if you have time to see a lawyer in such a short amount of time but you should if at all possible.
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igloo572 Feb 26, 2024
Hothouse, having an LTC Medicaid applicant buy an IFT / Irrevocable funeral trusts for adult child may NOT be allowed as a within exempt spend down for a States LTC Medicaid program. Totally State dependent.

All States but 2 (NY & MI) allow for IFT for the NH resident and their community spouse and $ comes from their assets. So lowers overall assets. NY and MI allow for an irrevocable funeral arrangement or contract. A State can limit the amount of the IFT allowed as exempt. It could be 15K each which is the max that most States do but could as low as NE $6,346 or Utah’s 7 K or GA @ 10K.

For buying them for adult family, only 4 States allow for this: AZ @ 9K max, CO, IL $7,719 max, Missouri $9,999 max and Oregon.

LSS it’s on you to verify whatever you are buying - that is irrevocable $ paid - meets your States regulations.

Again rules of your State will be very much important should you do an IFT as to whether or not it will meet Medicaid compliance, in addition to rules like the above, could also be…
- if your State requires a Good & Services document that must be submitted by the IFT company selling it to you and that the G& S meets State standards as to included costs. Right now half the States require a G&S.
- States can require registration with State entities. Like TX requires 3: Dept of Banking, Dept of Insurance and Funeral Service Commission. So missing 1 of the 3 too bad, so sad on that IFT eligibility as an allowed spend down.
- States can require the seller to hold a valid preneed funeral permit in their State.
- States require that the State is listed as the residual beneficiary. It’s done to have the policy be OK for estate recovery required attempt. State may have specifics on timeframe as to by when any residual must be paid by and interest if not.

I'm not posting this to be all smartyIgloo but it’s really easy for families under time crunch of a spend down to hear what they want to hear. And then it becomes an expensive bite on the butt. That $ paid is irrevocable, pffft! It’s gone.
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