My grandmother needs to be in a nursing home but I just found out she has 120,000 in the bank. How can I legally transfer that money out?

Pepsee, SusanA43, I agree with you both. Medicaid is abused and is rife with fraud to the point that people who need services don’t get them. My husband and I were Medicaid providers for psychological services. We both had clients on Medicaid who asked us to evaluate their child for ADHD so that they could get SSI for their child. When asked what kind of problems their child had they had no answer. One woman said her child was acting crazy and she wanted a check every month. We’ve heard it all.

I know there are many reasons that people can’t save for their retirement and end of life care. I want a safety net to be there for them. But I don’t want Medicaid to be given to those who have assets. I do not want the taxes that my family and I pay to go for a bunch of people who want to hide their money via trusts, annuities or any of the other financial vehicles they use. I could be hiding money right now if I chose to do so. I have a stepson who is an estate attorney and another who is a CPA and my daughter-in-law who sells financial products. But I am happy to say that they do not engage in assisting people to plan to get on Medicaid by hiding assets, including me and my husband.

I try not to comment on these conversations, because they kind of get my dander up, but here goes:

Why do they get my dander up? Here's why:

I was on Medicaid and Food Stamps as a young divorced mother between jobs - but as soon as I got a job, I made sure I reported it and got off the program. During the time I was on it, I was informed that if I didn't report my ex husband to Child Support Enforcement and let his payments go through their system first (so they could deduct what my benefits were valued at and then send me the rest), that I and my children would be removed from the program for non-compliance. After some thought, I removed us from the program, did whatever work I could to make ends meet until I found a good job and moved on. I didn't have bitter feelings about it - it was just the way the system worked, and I wasn't going to lie and say I wasn't receiving child support when I was - but I also wasn't going to involve Child Support Enforcement in what was already a touchy situation between me and my ex. Just the words "Child Support Enforcement" would have sent him into a rage against me, even if it wasn't my fault they were contacting him.

My parents utilized the same programs when Dad was injured on the job and permanently disabled - because the worker's comp case was tied up in the courts for over a year and they had no income. Again, as soon as his settlement and payments came through, they got off the programs. They were never wealthy, but they managed. They just never managed to save anything for their future care or expenses. They both died on Medicaid in nursing homes/hospitals and the bills covered by Medicaid were astronomical.

One of my siblings was married to a man who was raised in a family where "bilking the system" was the norm. They faked illnesses, seizures, mental illness and such to the point of being qualified for disability and full benefits through the state - so they had Medicaid, disability payments, food stamps - the works. All fraudulently obtained. He had a wallet full of credit cards - again, all fraudulently obtained. (Keep in mind, this was back in the day when there were really no systems in place to check if someone was lying on an application - that's how he got away with it.) He never held a job, sold junk at a flea market to make money (which he never reported) and lived off the government his entire life. When my sibling divorced him, he remarried to someone just like him, and the fraud continued. He taught his kids how to do the same thing (despite my sibling's attempt to teach them to work for a living). Because he was on so many meds for the faked seizures, illnesses and mental illnesses, he actually did become very ill later on, and died at a very young age from a stroke. While I don't wish death on anyone, no one was terribly saddened at his passing.

My own child is in that system now, because she doesn't work. This irks me - a LOT - because she is capable of working and I certainly didn't raise her to think that it was ok to live off the government. She has one child left that is going to start school this fall - I'm waiting to see if she will actually get a job now that she has no excuse to stay home during the day.

My grandmother was well-off in her later years due to being thrifty, saving money and investing, plus having 2 pensions (one railroad, one government) from her husbands. She invested in CDs, had a high-interest savings account and lived simply. When she had to go into a nursing home, everything she had saved was used to self-pay for her care. When that ran out, she went on Medicaid, and her remaining pension and social security payments went to the nursing home to make up the patient pay portion not covered by Medicaid. My mother and her sister were her only children, and I know it must have just sickened them to think all of that could have been their inheritance, but I never heard a word of complaint from them about it - they knew it had to be used for their mother's care, and that was that.

Sooo, I've seen this from all sides - when the programs are needed, they are there for those people. I've seen those who scammed the system and got away with it. I've also seen those who scrimped and saved all their lives to save something for their children to inherit - but ended up using it all for their end of life care.

It's a sticky situation, but if the rules are followed, it's workable. Medicaid is there for those who need it. If there is money available to self-pay for a senior's care, then that's what it needs to go for. I wish I could tell you that the money can be withdrawn and gifted to you or someone else to avoid that - but that's not the case, and doing so will result in some serious problems.

I understand that you want to keep the money. I think should ask an attorney. The money can used to pay for things for your grandmother. Better check out what though. Things like a burial plot, dental work, hearing aids, but not trips to the Bahamas or diamond earrings. Medicaid officials have seen it all and know all the tricks.

I find it so ironic that the post a few below this asked how to provide care that is becoming overbearing cost wise with only VA benefits and SS, for the family. I also cringe sometimes when someone posts whose family is literally at the financial breaking point because their elders didn't or were unable to plan for this rough road we all walk. and then we see a post like this where the elder does have some assets. or a lot of assets. When my FIL and BIL were looking to place MIL, My dingbat BIL actually asked the NH rep how we could "hide the money"... She and I just looked at him,, I know I am lucky, and FIL saved all his life.. but no one in this family has enough for a fancy overseas exempt account! I was not very popular with either BIL or FIL when I pointed out they saved their money for their retirement,, and the time for spending it is here. Yes I totally understand wanting to leave something for your children.. but maybe taking care of your self should come first.

FF, AARP needs to readdress its conclusion. I saw this happening, wealthy people know how to transfer assets, and if they don't, they have the funds to hire an attorney or a firm that has as clients "individuals of high net worth".

Pepsee, clapping hands loudly. Well said. Before Dad died, folks would ask me if he was getting Medicaid. I told them, "no, he saved all his life for his retirement and that's what his funds are being used for. He doesn't have to suck off the government."

I feel like you do. Medicaid was intended for people who need help, not those who know how to shield assets.

Sorry, no, that's not why a post like this upsets me. But I will tell you why, since justification seems required here.

Medicaid has been screwed, swindled and abused. People have taken advantage of it, to the point they've cut back services and equipment the REAL poor people need!

Medicaid no longer provides many life saving medical procedures to the needy.,... because of fraud!

AND people think this is free money! My sons, brothers, Mother, husband and myself bust our butts at work to pay for this free money!

When you pay 30 percent of every dollar you worked for, just to watch it go to medical care for someone who has $120K under the mattress, yeah I get peeved!

And I have the right to express my opinion on a post like this.

Even though it seems like a lot of money, by the time you do the required "spend down" necessary for Medicaid qualification (this could be directed towards in-home care expenses, home modification, durable medical equipment, prepaid funeral expenses, etc.), the money will be gone within 2 yrs. Then you can get her on Medicaid and decide if you want her to be in a Nursing Home (doctor's authorization will be needed) or to be cared for in-home by a Medicaid approved provider. Depending on how many hours/day Medicaid approves, you might need to work out a schedule that will allow for respite (Medicaid Caregiver comes in when you are at work and you or any other family caregiver take the night shift or vice versa).
Note: Any money/assest transfer that is non care related or unexplainable within the last 5yrs might raise a red flag when trying to apply for Medicaid and might disqualify her application.

Campbell,

I think some of the posts have been a little harsh so I want you to understand why. There are some who would love to place LO in Long Term Care ( LTC) but Medicaid has income limits. Some people are over that limit because of SS or pensions but the income is not enough for LTC or a AL. Some on this forum have left jobs to care for loved ones and/or spent their own money so LOs could get the care they needed. Most of us are Seniors ourselves so this has made our future income a little bleak. So, when someone posts that they want to figure out how to protect 120k from Medicaid those on this forum get a little "upset". There are some that wished their loved ones had this kind of money. If not for a NH but to bring someone in to help with LOs care or some respite time. Caregiving can be a 24/7 thing for a number of us. So sorry if some of us seem a little up tight about this post, Hope though, that you understand what is involved when Medicaid is in the future. Having this info will help you hopefully not make a mistake that will cost u in the end.

Campbell12, I didn't see your question when it was asked a month ago, but it's still generating good answers and discussion. One answer that hasn't been mentioned, which might not assist you but may help others, is that your grandmother could use her $120,000 to pay family members to provide necessary care in her home or in theirs via a personal care agreement (PCA). AgingCare.com offers advice on PCAs at https://www.agingcare.com/articles/personal-care-agreements-compensate-family-caregivers-181562.htm

Whether or not your grandmother (or anyone else's grandparent or parent) will be better off in a care facility or in their own home or someone else's is a different question, the answer to which varies depending upon individual circumstances of those needing care and those providing care. But it is an option that is worth considering and that works fine for some people, at least for a while, but is a disaster from the start for others. You really should know what it means to provide the level of care someone needs before you agree to try to do it for an extended time period.

If you have money, why would you want to be cared for in Medicaid NH?

Where I live, LTC costs 10k a month. All 3 NHs are owned by the same person so no trying to find the cheapest. So GMas money would last about a year. Can she do an Assisted Living? Her money would last about 2vyrs at 5K a month. And that depends on the care she needs. If there is no money after 2 yrs, then the AL may allow Medicaid.

Has Gma assigned someone as POA for financial or Medical? Is someone else, besides her, on the bank acct?

I am still trying to figure out how do the wealthy hide money.

According to AARP "There is little basis for the assertion that people with substantial incomes or assets are becoming eligible for Medicaid by improperly transferring their assets."

Poor Grandma?! She has $120.000 g's in the bank.....that don't sound so *POOR* to me!

Poor Grandma...sounds like the buzzards are circling :O

Pfft

Campbell, I think you have a legitimate question. Most of us know little to nothing about Medicaid until we start looking into it. Many of our parents and grandparents put money aside hoping to leave it to heirs. The days of middle-class people being able to leave a financial legacy are pretty much over, unless they die fairly young and without chronic health conditions.

So the current situation is that money elders have saved has to be used for their own care. When that runs out, public funds are available.

The implication that you are trying to cheat is unfortunate. You are simply trying to understand your options. You aren't asking for a sneaky way to cheat -- you ask for how to do this "legally."

We shouldn't be scolding you ... just helping you to understand your options.

Any $ movement over 10k triggers a Treasury Dept currency transaction report. 

Most of us are never ever aware that this happens as it goes through FinCen & we are never ever notified. Usually as the $ is in a check that is looked at and the bank it’s drafted on is within ABA system and the business checks out and the check amount is within a pattern of deposits for your account it’s all ok. But the CTR is still done. If it’s cash deposited same thing but then it’s more if it meets a pattern for your account. Your bank does NOT & should NOT tell you a CTR Treasury Dept report is happening. It’s done routinely and part of banking regs to deal with money laundering. 

Also in addition to the CTR if you deposit a check way way over what you have in the account, the bank usually will do a hold on the check totally till it clears (+-20 days) or maybe -if they like you - a % hold on the check. So like 35% now and rest over time till 20 days.

Most of us do not have 120k checks coming through regularly. 

All this in addition to the fact that Medicaid will find the transfer and impose a gifting penalty on the elder so they will be ineligible for Medicaid even though they are now impoverished. 

As an aside the lovely Michael Cohen had CTRs done on the 130k payment to Stormy Daniels and apparently has otherCTRs to other women as well. What a marooon! Ray Donovan my fanny..... and it’s all coming out. Money all surfaces eventually. 

She probably wants to not be in a nursing home then. Maybe she wants to be cared for at home.

Campbell12, let's say you do take out the $120k and place it into your bank account, the bank will red flag that amount. There could be a chance that your Mom would need to pay a hefty IRS gift tax due to the amount in question.

Your Grandmother could become Medicaid pending, but Medicaid would want Grandmother to use that money to pay for her nursing home care out of pocket for as long as the money last, then there is a certain amount she can keep in a savings/checking account.

Please remember, the only people who can hide money are the very wealthy. Then you are smart. Otherwise you are a criminal taker. OK sorry. Just a short rant at the scolds who act like you shouldn't ask the question. You do need to have power of attorney or be a guardian to do anything. If you have that in place, it may be best to seek legal advice so you know how you can spend the money for her care. Some good ideas listed here including good wheelchair, clothing, prepaid funeral, glasses, etc. Document every cent. You can usually get a better nursing home if you self pay before applying for Medicaid which is intended for the indigent. This is a state easily reached in a nursing home costing $9,000 to $15,000 monthly.

That $120,000 is for your grandmothers care- not to be saved for inheritance. Taxpayers do not want to foot the bill for your grandmothers NH care. Medicaid was established to help low income persons. Spend her money for her care and when it runs out, then apply for Medicaid.

Like everyone else stated, you can't legally transfer that money out. Why do you want to? So that you will receive some inheritance money?

Please follow BarbBrooklyn's advice and spend that money on services and items that your Grandmother will need once she is in the nursing home.

Medicaid doesn't like it when the family tries to hide money from them. Medicaid looks back 5 years at financial records and if they think some money has "disappeared" from the bank accounts or been "gifted" to someone within the 5 years period (or insurance polices were cashed, or houses were sold, etc.) of the person applying for Medicaid, they will contact the person who received the money AND DEMAND THE MONEY BACK!!!

Some STATES have LAWS that REQUIRE MEDICAID to "seek repayment" or "reimbursement" from the Heirs for money Medicaid spent on the person while they were alive and living in a nursing home. I know of families who had to give the profits from the sell of their parents or grandparents home to Medicaid as "repayment" or "reimbursement" resulting in the family receiving no monetary inheritance.

Please heed the advice given and spend your Grandmother's money on your Grandmother.

To qualify for Medicaid, there needs to be a "spend down." It means exactly what it sounds like. Your grandmother will be private pay (average $6,000 per month) for nursing home until she spends down to her last $2,000. If she owns her house and a spouse is not living there, that too will go into the pot for her care (I'm not sure if it is simply signed over to the SNF or if the family has to start cleaning it out to sell or what). But she has to have no more than $2,000 worth of assets to qualify for Medicaid. Medicaid will look into all transactions of her money and I THINK the look back is now 7 years (or it may vary by state). You are NOT going to be able to hide that money. The hiding and finagling should have begun 10 years ago. 

If she is able to stand at all, pushing herself up out of a wheelchair and assisting in transferring herself from a wheelchair to another chair or bed, she is likely to be able to live in Assisted Living, which is cheaper than a nursing home. If she has dementia, to the point of wandering away, she would need to be in memory care or NH, and I would recommend going straight to NH over a memory care facility.

Campbell12 - if you think about it - you are asking to "hide" $120,000 so that the taxpayer has to pay for your loved one's care. [Medicaid is a program for the poor]. that is unfair to the taxpayers. In order to prevent movement of money - Medicaid has a five year look back period in the application process. All money has to be accounted for and spent on your loved one - no "gifting" otherwise Medicaid will not pay for nursing home costs for a penalty period. Who is going to provide nursing home level care for your loved one if she cannot get into a nursing home because she can't pay for it???

Work with an elder care attorney and what she can spend her money on (funeral expenses, dental work, etc) and try to get her into a good nursing home private pay that takes Medicaid.

You can't.

BarbBrooklyn has given you some good suggestions for ways to spend that money for her care. She could spend it all on private-pay for a nursing home, of course. But getting things like an electric wheelchair (if appropriate) and a new wardrobe geared to her disabilities (if applicable), definitely pre-paid funeral, and other things she won't be able to afford once she is on Medicaid is a good idea. An attorney specializing in Elder Law can help you work this out.

Be sure the NH you select does accept Medicaid, for when her money runs out. Most do, but definitely ask that when looking at them.

Medicaid has a 5 year look back period, which means they request 5 years of bank statements and look at where her money has gone over the last 5 years. Any moneys "gifted" to another family member during those 5 years is consider by law, her money. It will be considered part of her assets to pay for long term care.

WOW, stash the inheritance.....

"Legally"? Do you have her POA? If not, you cannot transfer or do anything legally with her money. Her money is for her needs and care.

That money will lay for a consultation with an elder care attorney, a pre need funeral, dental work, new eyeglasses (several pair) and sturdy outfits that will withstand commercial washers. And maybe a year of private pay. It will get her into a better NH than the one she goes into Medicaid pending. Be grateful it's there!

why don't you think that money should be used to pay for her care?