A home may be exempt from foreclosure depending on key factors.
At thousands of dollars per month, nursing home care for your dad can devastate finances quickly. Exorbitant bills may not be covered in the long term by government programs such as Medicare or even private insurance. State programs like Medicaid help cover costs for those who are impoverished, provided all your dad's savings have already been exhausted. Investments you may need to protect for your dad may include the family home, depending on how much it costs and who lives there.
High Cost of Nursing Homes
In 2011, the median cost of nursing homes ran about $200 per day. If your dad fits several key criteria for a Medicare-approved facility, Medicare may cover the cost for the first 100 days. After that, Medicare only covers a fraction of the cost, leaving the rest up to the patient. This can quickly bleed your father's estate. Once savings are exhausted, state medical aid such as Medicaid steps in to pay for the care of those who qualify for its services, but generally the family home is exempted up to a certain value for your dad's eligibility. State to state, this can vary from $500,000 to $750,000.
Eligibility Versus Reimbursement
While the value of the home will not affect your dad's eligibility, it can be used as reimbursement for funds spent by Medicaid to pay for nursing home costs. This entitles Medicaid to take a lien out against the home. If the house was given to someone else, including family members, within five years of your dad entering a nursing home, Medicaid is unable to put a lien against the house. However, such a circumstance may cause a delay in Medicaid paying for the nursing home, which could leave the financial burden up to a responsible third party.
Exemptions
Provided that you meet certain criteria for exemptions, Medicaid should not delay payment. If the house transfers to an adult child who has lived in the home for two years prior to your dad going into a facility, and that person provided care that kept your dad out of a nursing home, the home would then be exempt. The same is true if your dad still has a minor child, or an adult child who is blind or disabled living in the house. Any sibling who has lived in the house and has had ownership interest prior to the five-year window, may also have the house transferred into his name without penalty or lien.
Responsible Parties
Because Medicaid pays a lower rate than an individual would, many nursing homes require that someone in the family sign paperwork to assume financial responsibility for long-term care. These are costs that would typically not be your responsibility without your signing paperwork saying otherwise. Consider this carefully before you sign on to take any accountability for upcoming bills.
Tips Warnings
Thanks to my sister, the lawyer, for contributing this important article.
Related Posts:
Protect Your Family'S Assets From Devastating Nursing Home Costs
The cost of an extended stay in a long-term care facility can be devastating to a retirement portfolio. According to the Long Term Care Clearinghouse, a federal repository of long-term care inform...
Protect Money From A Nursing Home
Affording nursing home care requires proper planning.Nursing home care may be the only option for some senior citizens. Unfortunately, nursing home expenses incurred can be overwhelming. Protectin...
Nursing Home Patient Asset Requirements In Pennsylvania
You may divest some assets to qualify for medical assistance by buying independent nursing care resources.Medicaid provides medical assistance including nursing home care to all qualifying seniors...
Shelter Assets From Nursing Home Care Costs
Protect your assets from nursing home costs.People spend their entire lives accumulating assets. Unfortunately, if you or your spouse becomes sick and requires nursing home care, your assets will...
Eliminate An Estate For Nursing Home Costs
Putting a loved one such as a grandparent or parent in a nursing home is a difficult decision. It becomes more complicated when estate planning needs to be handled in addition to physical care. If...
