Posted: Mon Jun 18, 2007 8:33 pm Post subject: Will a enhanced life estate deed cause a Medicaid penalty?
We recently applied for Medicaid in Texas for my elderly, disabled mother who is in a nursing care facility. We spent down all her assets with the exception of her home. We put that in a "lady bird deed". Medicaid notified me that she is going to be penalized for having a "lady bird deed" on the home. I was under the impression that this deed would not cause a penalty period. Should we have waited to draw up the deed for a later time? Please help...
I think you should have waited for some more time prior to drawing up the deed. but hey, did they give you the condition that you cannot draw up any deed or else you will be penalized. They must have informed you about this earlier. _________________ Procrastination is the enemy of your financial sucess
Actually, the medicaid case worker was nice enough to tell us that my mother will be penalized for having the lady bird deed. And put her application as "pending" in case we decide to "void" the deed. Interestingly, we hired a law firm for legal advice as soon as my mother entered a nursing home and they are the ones who encouraged us to draw up the lady bird deed and include it with my mother's medicaid application. How can an elderly, disabled and widowed person protect the only thing left she owns and not be penalized by Medicaid?
I understand but if that's the rule, you can't really go beyond it. You can at best request them to spare your mother as she is disabled and old enough to bear the penalty.
Posted: Mon Jun 18, 2007 9:09 pm Post subject: RE: Ladybird deed - a cause for medicaid penalty
Hi Jomirel,
Welcome to the forums.
The law firm, as I feel, shouldn't have encouraged you even when they know that it may lead you into trouble. Anyway, what's the penalty that you'll have to pay?
The penalty is assessed by disqualifying the applicant for a period of several months even for years. I have not been told the exact time period my mother will be disqualified.
Penalty period is calculated by dividing value of property transferred by what is determined to be average private pay cost of any nursing home in your state by Medicaid.
As an example, if in your state average monthly cost of care is $6000 & property worth $180,000 is transferred, then the person would be ineligible for benefits for 30 months ($180,000 divided by $6000 = 30).
Posted: Mon Aug 20, 2007 7:33 am Post subject: Enhanced Life Estate Deed
I was told that if you have a Enhanced Life Estate Deed that medicaid could not take your home away from you. That she would have complete control over home and after she dies it will go to the heirs that are stated in the will. They said it really is from the Ladybug deed? is the right?
Enhanced Life Estate Deed/Lady Bird Deed, does enable a person to have the home exempt from medicaid claims during his lifetime. And also enable persons named on the deed receive the house free from medicaid claims. _________________ Good is the Enemy of Great.
Posted: Wed Dec 05, 2007 9:16 am Post subject: timing is key
timing is key, disposal of assets within 60 months/5 years BEFORE APPLYING causes a penalty ..... i haven't read of any penalty AFTER QUALIFYING ..... in texas a home's value is exempt for qualification purposes, but subject to merp if no ladybird deed is done after qualifying or before 5 years before the original application is filed
Posted: Wed Mar 26, 2008 5:52 pm Post subject: lady bird deed
What exactly is a lady bird deed? My father's home is still in his name. It's his homestead. I have power of attorney and my father left me the home in his living will. I was told that the only way I could transfer the deed into my name is if I get his doctor to state that I was the one caring for him and living in the home for 2 years or more and because of me not being able to care for him he had to go into a nursing home. Then I was told that I didn't have to do that I could get a lady bird deed done and with that the home can transfer into my name. I wasn't sure. But before I do anything I want to make sure it's correct and legal. His been in a nursing home going on 3 years.
You are rightly informed that if your father use a ladybird deed and make you the grantee then you can get his property after his death and it will also help you to avoid probate process.
Posted: Thu Mar 27, 2008 1:25 am Post subject: RE: transfer home without affecting medicaid
Hi Amanda,
Welcome back.
Transferring the property prior to applying for medicaid may disqualify your father from getting the benefits. In most cases, the person may be disqualified for 3-5 years. However, if a ladybird deed is drafted and signed by your father over to you, it will help you in getting the property rights after death. By the way, has your father already applied for medicaid?
One more thing, if a child is under 21 years, then assets can be transferred to him/her without any penalty. However, the state laws regarding medicaid and property transfer vary from state to state, so let me know in which state you reside.
jomirel
