Legal Question in Elder Law in Florida

I am greatly hoping that you can provide some help. My Mother and Father are 88 and 92 years old respectively. My parents have approximately $260,000 in total assets and they live in an Assisted Living Facility (ALF) in Tarpon Springs. My father has been advised by a representative of a private organization U.S. Benefits Group that my father should consider purchasing a $230,000 ten year single premium Annuity in order to lower their countable assets below the VA cap so that they will be eligible for VA Aid and Attendance benefits. The Annuity would be taken out in my sisters� and my names. My understanding is that this annuity would pay income on a regular basis which, if needed, could be used by my sisters and me to help with the payment of their living accommodations . This Annuity also has a substantial penalty for early withdrawal (i.e. 9% in the first two years and a downward sliding scale thereafter). My concern with this plan is that this Annuity might make my parents ineligible for Medicaid long term care benefits should they ever need a higher level of care (i.e. memory unit or skilled nursing).

I have been advised that Medicaid has a gifting penalty provision which assesses a 1 month penalty for every $5,000.00 transferred in the past five years, and this penalty does not start to run until my parents actually apply for and are otherwise eligible for Medicaid. If the Annuity is in my parent�s names they will be over the asset limit for Medicaid. If my sisters and I are the owners of the Annuity, my parents will have a 40 month penalty if and when one of them applies for Medicaid.

We are in need of some sound objective advice and have been told you are an excellent resource for these situations. I work in Connecticut but live in New York which leaves me at a major disadvantage in helping them the way I could if I lived closer to them.

Any assistance or advice you could provide would be greatly, greatly appreciated.

With my sincere thanks for your consideration,

Cathie

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