Legal Question in Wills and Trusts in Indiana
Where should the money go?
My Mother is 93 and at her last stop having just entered a nursing home. This is a question concerning Medicaid. Four years ago she created three CDs, one for each of us children. They were taken out in the name of ''her or child'' in every case. She is disabled and just placed in a home. We have cashed in the CDs as that is what she would have us do. The amounts were for less than $20,000 each. She will soon be needing the assistance of Medicaid. The quesiton is does the money rightfully and legally go to medicaid or is it our money as the children? We of course want the inheritance but want to do what the law requires.
Thank you for your assistance.
1 Answer from Attorneys
Re: Where should the money go?
Medicaid looks for "uncompensated transfers" that occured in the years preceding the application for assistance from Medicaid.
Gifts or other transfers that your mother did not recieve fair market value for will incur a "penalty period" during which your mother will not qualify for Medicaid - even if she otherwise meets the strict income and asset requirements to be eligible.
During the penalty period your mother's other assets will need to be used to pay for her cost of care (usually between $5,000 to $10,000 per month), or someone else will need to pay, which is quite often the children.
The Medicaid rules are very complex, and I highly reccomend speaking to an attorney familiar with this area of practice. Often times, as long as the client has not applied for Medicaid an attorney can help preserve a significant amount of the client's assets for their family. Mistakes, or lack of understanding can be costly here.
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