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Will a enhanced life estate deed cause a Medicaid penalty?

Posted on: 18th Jun, 2007 08:33 pm
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...
Hi aleksy,

As far as I know, enhanced life estate deed will not make a person ineligible for Medicaid as long the person expresses his/her "intent to return" to the property. The "intent to return" is generally expressed in the form of an affidavit or letter signed by the person. In case if there is no intent to return, the home can be said to be an exempt asset for Medicaid eligibility if that person's spouse or relative occupies it. But Medicaid has a look back period of 5 years. Transfers of countable assets during the look-back period of 5 years will lead in a waiting period. Once the waiting period is over, then the person concerned can start collecting the Medicaid.

Thanks
Posted on: 01st Jan, 2009 10:36 pm
to Guest Christyne

Sounds like a touchy situation: since the property wasn't a homestead.. or
did the person live there at all.. they may not have bothered to file for
a homestead exemption,. as for it being in a Lady Bird / Enhanced life estate deed,.. if its been notorized before this person became disabled.. I sugest you file it on public records with the clerk of court,. and that depends on all the wording on that deed,. once your loved one passes,. the property is yours by operation of law, the next step is to file the death cert, with the court.. then take the copy of the bird deed that will also be of public record by that time.. and change the owner of record at the property appraisers office.. then the question comes about the mediaid lien if any was put on that property,.. they may have only filed a lien of record to the estate.. which means your title should be clear,. but if theres an actual lien on the property you can file outside of probate court a separate case of whats called a " Quiet Title Suit " against the lien.. this is done to get the encumbance off "lien off " the property,. from diffent views of both property laws and probate laws of florida.. I'd say the Quiet Title action to clear off the medical liens would be the best course of action,.. since in probate the judges have there hands tied to the probate codes which say that Medicaid gets paid,. ware as in a separate case outside of probate in a quite title action.. medicaid has to come in with repersentation but in probate they do not.. they just file there claim,. the research shows that medicaid has lost in quite title actions.. in tax deed sales that they had liens on a property because of the former owner.
Posted on: 12th Jan, 2009 01:56 pm
My mother-in-law is close to having to go into a nursing home. The lawyer has told my father-in-law if he places the home/farm into a lady bird deed, he will not have to spend down for Medicaid and when she/he passes that Medcaid can not come after the home/farm for owed monies for the nursing home. He is the only lawyer we can find who will do a lady bird deed. The home/farm is located in North Carolina. No lawyer even the bar association is aware of the lady bird deed in North Carolina. Is it accepted by Medicaid in North Carolina and if so, does it meet the criteria stated in my above questions? Any help would be appreciated.
Posted on: 16th Jan, 2009 09:13 am
Well, as far my knowledge, lady bird deed or a life estate deed is accepted in North Carolina. A lady bird deed will not disqualify your mother in law to receive the medicaid benifits if she plans to return home. Even if she does not return home, the property will be exempt from medicaid estate recovery if her spouse or relative stays in the property.
Posted on: 17th Jan, 2009 01:18 am
Medicaid (aka madical in california). When applying for medical, you can have no more than $2000.00 at any time, one house, and one vehicle. If one gifts their home to their kids, they need to do it through an Elder Attourney....not just "an" attourney. It is important to have a "intent to return" written and signed by the giftor when gift made legal. Always get the appropriate legal advise before, during, and after. Gifting can work!!! Don't just give it to the state....protect it.
Posted on: 31st Jan, 2009 09:47 pm
my grandfather has been in a nursing home for 5 months. his house is his only asset, which is due to go to my mother after his passing. they had a quit claim deed done years ago prior to his going on medicaid. in michigan, will the ladybird deed avoid probate unlike the qcd? he just qualified for medicaid in january. will doing a ladybird jeopardize his staying qualified for medicaid?
Posted on: 02nd Feb, 2009 03:51 pm
I am interested in getting a Ladybird deed to transer my real estate to my children. I live in North Carolina.
Posted on: 13th Feb, 2009 07:19 am
Hi jewart,

Enhanced life estate deeds or better known as Lady bird deeds are valid in states like Florida, Texas, Ohio, California, and Kansas. As far as I know there's no such clearly-defined law in the sate of NC that validates a lady bird deed. Thus it would be better if you can check with the county clerk's office whether this deed is valid in your state.
Posted on: 16th Feb, 2009 04:40 am
My mother-in-law is in a nursing home in Mississippi which most of the cost is paid for by Medicaid. She stands to inherit a small amount ($10,000) of money from a brother that has just died. How will this affect her Medicaid eligility and what should I do or what can I do to be able to maintain her eligibility? Thank you for your advise.
Posted on: 26th Feb, 2009 04:27 pm
Hi billy,

This might affect your mother's Medicaid eligibility and can even disqualify her for Medicaid services. It depends on the value of the property she inherits and whether it exceeds the resource limit. She can disclaim the inherited property but that too may attract transfer-of-assets penalty which can enforce an ineligibility period.
Posted on: 26th Feb, 2009 11:14 pm
I need to know if there is indeed an attached medicaid 'transfer' penalty when you have the lady bird deed, or if this penalty can NOT be attached if you have the lady bird deed. Plz. someone answer this question. I have read conflicting statements on this site, on this subject. One says yes, one says no....? What is the truth regarding this subject? This involves a home, medicaid, and nursing home in the future. This is in Texas.
Posted on: 11th Mar, 2009 02:30 pm
Is there a medicaid penalty for tranfering a home to a chid when the lady bird deed is used? Does it matter the deed is made before one files for medicaid or after? (in Texas)
Posted on: 11th Mar, 2009 02:31 pm
Hi jmessyd,

Any transfer within a look-back period of filing for medicaid will attract a penalty and make one ineligible for medicaid for a certain period of time. The penalty will depend on the value of the property transferred by the grantor.
Posted on: 12th Mar, 2009 05:35 am
MY SISTER QUIKCLAIMED HER PROPERTY TO ME (IN TEXAS) BUT HAS A LIFE ESTATE. THIS WAS SOMETIME AGO SO ALL IS WELL THERE-NOW SHE IS IN A NURSING HOME AND WILL NEVER RETURN TO HER HOME, CAN THIS PROPERTY BE SOLD WITHOUT PROCEEDS GOING TO THE NURSING HOME.
Posted on: 16th Apr, 2009 04:47 pm
As she still has a life estate, I think the sale proceeds from the property will go to the nursing home.
Posted on: 16th Apr, 2009 10:04 pm
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