When applying for Medicaid for my Dad, do we have to report those closed bank accounts and closed IRA's?

If you are spending down the money on his health care or items for his own use (i.e., not making gifts out of the money), then you need not worry about closed accounts. When you apply for Medicaid for your dad you may have to prove what the money was spent on, so save the receipts, just to be on the safe side. When a person applies for Medicaid, they must report all their current assets as well as report any gifts they made within the last 5 years. Obviously, lying about past gifts is fraud against the state and federal governments, so basically the government relies on applicants telling the truth, just as the IRS does when you fill out your tax returns.

All I can add is that I am so glad we went to an Elder Law Attorney 6 yrs ago and put Mom's money in a Family Trust.. She lives here with me, doesn't own any property.. If she needs money it comes from the Trust..

I think you must report closed accounts if they were closed within the 5 year look back period, and if there were any transfers of the proceeds of the accounts to anyone else, like a gift.

no, you need not report any closed accounts.

I think you should report all closed accounts in order to avoid delays. My Dad's Medicaid application was delayed numerous times, while they asked for more and more data....and among those were accounts that had been closed for over 20 years!! So I believe that in some offices, people will just delay and investigate to 'show their power', therefore, giving them everything you can right up front might keep that from happening and get the approval to happen quicker. I had a financial advisor from an eldercare law firm helping me with this and she was very experienced. SHE couldn't even understand why all the delays and requests for info for way farther backthan 5 years, but if you do not comply, there is just another delay...and unfortunately, the gov't has all the power in these situations!

You do have to report the closed accounts and IRA's because if you do not it will look like you're committing fraud and then your dad may not be approved for Medicaid.

If you have a 1099 and don't report the amount, your tax return will bounce with the IRS and they are not nice about it. If you "forget" any financial transaction on the Medicaid application, ANYTHING within the last 5 years, you will be in deep doodoo with them as well and they will be extremely suspicious when you reapply. Instant Audit flag on both agencies. Don't do something risky.

Thank you everyone for the answers, that was one I couldn't find on the medicaid site. Want to get this done without delays.

You defnitely need to consult an elder care attorney about this. Most Medicaid agencies have a look-back period (6 months to sometimes as long as 5 yrs), in which your elder can be considered inelgible for benefits if they divested themselves of any assets (automobiles, homes, bank accounts, etc. - anything sold or given away to someone else that could be counted as an asset under their rules).

We had a devil of a time with Medicaid for my dad, because he had an old conversion van he was going to sell to my son for $300. Unfortunately, just after my son went and transferred the title to his name, put plates and insurance on it (but before he paid my dad for it), the van suffered a major breakdown and was not repairable - so Dad said consider it paid for. Medicaid didn't see it that way. I had to go back to the junkyard that we had come pick it up because it wouldn't run and get a written statement from them that the van had no monetary value when they took it, and the only value it had was for scrap - THAT'S how picky they are. A van worth absolutely nothing was considered a divested asset.

Fox - just so much of the mice-maze that is Medicaid is dependent on just how your state runs it's Medicaid program. Medicaid is a joint state & federal program…it's under an overall federal guidelines & base requirements BUT is administered or managed by each state. For my mom, who is in TX, it was a 3 year & 6 month review of her banking. That meant for the last 6 months of bank statements and cancelled checks. BUT for the 3 year look back part, that required a signed on bank letterhead document from a bank officer @ her bank as to the disposition of each account that was closed within the 3 year period. Fortunately for us, as each CD, Tbill, etc. expired it was not renewed but put into her main drawing account. So it was a clean clear picture of what her banking history. She was in IL and still had her home, so those were significant costs each month that made sense as to where her money went to and why she could find herself "at-need" with less than 2K in non-exempt assets. BTW it took the better part of a morning at the bank and I had all her statements & old CD, etc stuff so they had details to start with and then do their verification to provide the letter. (The bank was pretty nice about it, but I know of others whose bank charged a research fee to do this) In order for my mom to be accepted by the NH as a "Medicaid Pending" resident, she had to have this letter

What I think Medicaid looks for is a "pattern of spending" that makes sense for what their bank statements are like combined with their monthly income and IRS info. Realize that they have to provide documentation on their income (like the annual statement from SS). If your state does an IRS match-up with 1099's, you really have to include all those accounts which produce any income as they will show up in the review eventually.

Medicaid knows how much they have each month. Say mom gets $ 1,800 a month in income and lives with family for free & does not have a home. So mom should have some degree of savings or a nest-egg from her annual income of 21K. (That is unless ma is out there playing the ponies each week but if she is doing that she won't qualify for or is needing a NH) If all she has now just a few hundred $, just where did she spend it? Ma needs to show a pattern of spending that makes sense & is within the Medicaid regulations.

All real property records (home, land, auto's) are recorded by the local tax assessor and then that info is dovetailed into the state. So for Susan that is why they had an issue with Dad's van. You really can't leave this stuff out because it will surface…..eventually.

Also once they are on Medicaid, you are not out of the paperwork woods either. I don't know how other states do this, but for TX there is an annual recertification in which you have to provide the last 4 months of their bank statements plus other financial documentation (like current years SS statement and retirement annual statement), plus other items. And yeah some of these (like funeral policy info) are the same documents included with the original application but you have to restate all this and indicate any changes and provide the documentation again for the renewal. It is due within 13 days of the date on the letter too. So keep your paperwork together for the future to make your life easier.