The needs of both my parents are now increasing to the point we will need to look for placement. They both have dementia, and I have been managing their bills, dispensing their medications to them daily, grocery shopping, helping them with ADL, etc. for the past three years. They live in my home, but have around $45k in assets between an annuity, a money market account and their checking. Can they transfer those assets to me since I'm their adult child caregiver? I'm looking to get them qualified for Nursing Home Medicaid. We have never charged them anything for rent or utilities over the course of the 17 years they've lived with us and I'd hate to see their assets evaporate once they are placed.
"I'd hate to see their assets evaporate once they are placed."
Others have mentioned it as well - but I really wanted to zero in on this.
Their assets are theirs to pay for their care as they age. You mention that you've been caring for them in your home for 17 years. And later mention "They both have dementia, and I have been managing their bills, dispensing their medications to them daily, grocery shopping, helping them with ADL, etc. for the past three years."
At some point, when their care began increasing - those three years ago when you had to do hands on care - it might have been worthwhile to sit down and say "Hey mom and dad, you guy have lived here for a long time and I've never asked you pay any rent or utilities. But here lately I've noticed that you need my help more and more. I'd like to talk to you about contributing in some way. Maybe pay rent. Or pay me a certain amount to be your official caregiver?"
Because those assets that you are asking about now - could have gone to you then via a contract of care. But now their funds- especially in light of the fact that you intend to apply for Medicaid - all of their funds will have to go towards private pay placement.
Their assets are not evaporating. They are going toward what they should go towards. Their care.
Evaporating would be if they handed it over to a scammer and never saw it again. Or bought a boat and it sunk the first day they had it with no insurance. Evaporating would be having nothing to show for it.
Paying for their care, when keeping them in your home is no longer possible - is the epitome of having something to show for it.
It is only right and fair that your parents' assets "evaporate" for their nursing home care. That saves the taxpayers - me, for instance - from the burden of paying for it. Their "evaporated" money will cover the salaries of their caregivers, the food at the facility, their entertainment, room, housekeeping, nursing care, field trips, and a lot of other things that they'd have been paying for long ago if it weren't for your help.
What also would have also been right and fair is if your parents had started paying you room and board 17 years ago, as well as given you money for your hard work, but that train has left the station. I'm very sorry, but take heart that your parents will be getting 24/7 care from professionals now, and when they run out of money, Medicaid is there.
Many years ago my Mom had some non-yet mature EE bonds in her name and then changed the names on them. Whatever it was she did was essentially cashing out those bonds in the eyes of the IRS, so she wound up paying taxes on them.
So basically you either will have to transfer the assets out of their names and keep them out of a facility until the look-back period with Medicaid is over, or you will have to do a spend-down of their assets to pay for them in the nursing home. When they have all been spent down, the NH will take their mmonthly income and the taxpayer will pick up the rest of the bill through the Medicaid program.
You should've charged them room and board for 17 years. Now there's a look back period of usually 5 years from Medicaid to make sure there was no "transfer of assets" right before applying for benefits. If they find such a thing, benefits are denied.
They could have transferred them to you consistently in the past had you made a care contract for shared living costs-- mortgage, rental, food, such like--with an attorney all those years ago.
Now it is too late. You cannot get paid for past care with no contract.
Anything they do now about giving you that money would be considered gifting and would disqualify them for medicaid.
If there is a way to protect these assets I don't know of it.
An attorney may find a way, if you were their POA and have proof of expenditures you made on their behalf, but it would be dicey and would be questioned.
Definitely time to see an attorney. Sadly way past time to do so. I sure wish you luck.
In most states, Medicaid only covers LTC, which is medically assessed as needed by a physician (and usually means the person is bedbound or has a profound illness/injury that requires a lot of medical care) and then needs to qualify financially. In most states, the application "look back" period is 5 years.
Do not do anything (such as moving assets or changing names on titles, etc) without first consulting with experts and knowledgeable professionals for your home state.
If you are not currently the PoA for your parents (or no one is) then this is where you might need to start, since their decisions need to come from a legal representative.
If you are their PoA, and it is now active based on the criteria outlined in the document, then find a great facility that accepts Medicaid. But don't transition them without knowing all the facts about how it will be paid for or when they will be eligible for Medicaid. You will need to spend down for both parents for them to qualify financially (and $45K split between 2 people won't pay for much).
Their assets are for their care. And Medicaid will expect them to spend down to a certain point before they will cover their care. Including paying for facility or 24 hour care.
If they are placed -Medicaid has a look back period - it varies by state - but the typical look back is 5 years. AND before they can apply they have to go through the spend down to qualify.
If they transfer their assets to you, they are placed and at some point in that look back period they need to apply for Medicaid to continue to pay for their care - that is where you run into major problems. Because Medicaid will not cover the equivalent amount that was transferred.
Meaning - let's say they transfer the $45,000 to you - then Medicaid will consider that money that should have been spent on their care. And they will not cover the time frame that money would have covered. There is a formula per state- and in some cases per facility - to calculate the amount. In that case you would either have to transfer the money back, pay the gap out of pocket somehow or you would have to remove them from the facility and find an alternate way to provide care for them full time until Medicaid can kick in after the gap period.
https://www.medicaidplanningassistance.org/medicaid-look-back-period/