Or: what is included or excluded as reasonable expenditures when Medicaid goes back in your accounts to see what you have spent your money on? Illinois is the state in question. Can I give money to my grandson who needs the money for medical care? He will keep receipts. Would it make a difference if I made it a loan instead of a gift?
Please call an Elder Care lawyer and ask for a free consultation. Ask the lawyer how you should best set up your assets for the- hopefully unlikely -event that you or your spouse (if any) need nursing home care in the next five years. When he or she discusses gifting, which they will, ask "Not even for a life and death matter?" and "How about loans to family members?"
We just went through this process and a $7000 gift given to a child a few years ago (for an excellent reason) means that there will be a $7000 penalty applied if the person applies for residential Medicaid in the next few years.
But an $11000 home equity loan (that I know for a fact was not spent on the house) is not presenting the same problem. I don't know why but a lawyer would.
You may be able to help your grandson without putting your family in the terrible position of having no way to pay for care for you if you became terribly disabled. We can give opinions. But you really need the advice of a lawyer who specializes in Elder Law in Illinois.
One sticky with penalty’s is that in order to apply for LTC NH/AL Medicaid, you have to be a resident in a facility and at the point with no more than 2k in nonexempt assets. So if you have a penalty placed you will be ineligible for Medicaid to pay although you now are impoverished. You have no $. In order to stay at the NH, someone in your family will need to sign off on a legally binding contract to private pay for your care. So will that grandson pay for months of your NH care? Will his parents? NH can easily run 10k - 15k a mo under private pay.
I’m guessing that there have already been smallish gifting from you as loving grannie to family members, that’s right isn’t it? If so, you and whomever is your DPOA need to meet with an elder law attorney; taking along your last 3 - 5 years of financial statements to see just how much of a penalty you have placed yourself in. And let the attorney guide how to best approach all this as they know the nuances of just how your states Medicaid runs. It’s not a DIY.