Q: It’s likely that my mom will need to go into a nursing home soon. She does not have a lot of money but she still owns her home. Will we need to sell her house to pay for her care?
A: As with all long-term care matters, your question is more complicated than it seems. The short answer is ‘no’, your mom will not be required to sell her home to pay for her nursing home care. Medicaid, often called MassHealth in Massachusetts, is a state and federally funded program that will pay for the long-term care costs of people who are both medically and financially eligible for the program. In order to be eligible for long-term Medicaid benefits, the applicant cannot have more than $2,000 of ‘countable assets.’ Bank accounts, investments, retirement assets such as IRAs, the cash value of life insurance, and deferred annuities are examples of countable assets. A person’s primary residence is not a countable asset. As such, someone who has less than $2,000 of countable assets and owns her home may be eligible for Medicaid to pay for her long-term care nursing home care. However, that is not as good as it sounds. For one thing, a nursing home resident who is receiving Medicaid benefits must pay all but a small portion of her monthly income to the nursing home. As such, unless the home is rented out, or unless family members are willing and able to pay the real estate taxes, insurance, water and other utility bills, there is no money available to maintain the home. Further, the state wants to recover the benefits paid on behalf of the Medicaid recipient and will place a lien on the property. The house will likely need to be sold following the death of the MassHealth recipient in order to satisfy the lien.
There are many other factors that need to be considered in connection with the home and Medicaid eligibility including the marital status of the applicant, whether any gifts were made, and whether there are any exceptions to the prohibition on transfers in a family’s situation. Because of the complexities involved in applying for Medicaid benefits to pay for long-term nursing home care, it is advisable to consult with an experienced elder law attorney as soon as you anticipate that nursing home care may be necessary. Please call us if you find yourself in this situation.