Medicaid spend down - spend money on what?

Our financial advisor and attorney who are helping me as the POA person for my parents, said, when we got to Medicaid applications, that the 'spend down' money should only be spent on medical care type items or on home repair and improvements. And if both parents are there, medical care can be on either of them. We were qualifying Dad, but it was fine to get my Mom new hearing aids, for example. As I understand it, Medicaid is OK with the home upkeep and repair, because at the end of the line, it becomes necessary at some point, unless death occurs first, to sign over the home to Medicaid or to sell it for additional monies, so they are apparently banking on getting a higher payback from the home if the money is used for repairs and improvements. Unfortunately, all the 'inheritance' or 'gifts' are gone for you, unless they were given or arranged at least 5 years before the Medicaid application. I am the only one left. At one point my Dad had a million $$ in investments; a great trust set up that supposedly was set up so that no matter how the money was used up....only half was used on his care, then the other half was held privately for Mom, but half of hers was automatically set aside for my inheritance. Of course, we find that the minute you've used enough that in order to provide for Mom, and his half is gone, you've got to go for the Medicaid and all the rules change. So all that is FOR SURE left for me, will be a $10,000 life insurance benefit created long ago where I am the beneficiary. We don't have to touch that one as it is more than 5 years old. And my poor Mom, who is still OK to be in her home....just turned 88 this week....if she lives long enough, will be forced to leave the home and have it sold because her 'half' now of the remaining assets do include the home. We are running out of the cash....have been paying between $4000 and $5000/mo since January for Dad's care, while working on the VA and Medicaid applications and now just waiting for the approval. VA, which seemed viable in the beginning since he is a WWII vet, turned out not to be possible, due to the very long wait veterans have going on now with all the injured war vets needing help. They do some sort of weighting on the veteran based on age, so that if older they go to the top of the list, but when we turned in his application back in February, the VA said, even with the weighting added on it would be at least 8 months before he even got to the top of the list, so we would be better off doing the spend down and going for the Medicaid assistance. Now....having done that, and running out of his share of the money, I don't know what we'll do if they end up denying him anyhow for some reason, but all I can do is turn in every piece of paper on time as the financial advisor says I should do. I just follow instructions and ask questions when things do not make sense. I am coming to understand that the expectation is that when the money runs out, I will just place Mom someplace, and sell the house.....and we'll have a little war on our hands if she's still able to be at home, because I've been making it clear all along that as long as she can be in her home, I am NOT taking that away from her!! I know Medicaid also know pays for help in the home, and she is entitled to some VA assistance herself as the wife of a veteran....but how/when it all works out, I don't know. I do know that my husband and I have absolutely no resources to put into the pot. We don't have much of our own retirement savings left due to all we lost in the economic turn downs since 1985.... It seems to be that the less money the elderly have, the easier and faster they get the Medicaid approved though. If you don't have a legal advisor about all this, I hope you do have a Medicaid worker telling you what to do?? I am not an expert, as I said. So don't make decisions based on my comments. IT may be that each state is different too....and we are located in Arizona. Get advice from an elder care attorney or other expert on Medicaid before you do anything.

It seems absurd that one can work and save their whole life to leave an inheritance to their children -- but then NOT be able to because they were unlucky enough to live too long and need a NH.

Yeah, Jenny! I kind of wish my parents would have spent more....done more together....been more frivolous with their money and not had as much left! My job here now, would have been much easier too....with the same end result....it would all be gone....but they would have had more happy memories together before it got to this point. Kinda makes me wonder why we all work so hard to eat right, exercise and take care of our bodies, if the end result is living so long we lose our minds and everything we worked for all our livesl! It's rather depressing!

Yup, it is depressing and it is sad, but it is the new reality. As things are now, few working people can expect to leave a financial inheritance for their children. We still need to work hard and set money aside, but for our own care, not for our children. It is just a different world now.

keppelish, I think you would do well to consult an attorney who specializes in Elder Law about your situation. Was there ever anything in writing about paying you back for your years of caregiving?

Definitely things for healthcare are allowable as spend down -- hearing aids, for example. And so are things like several pair of shoes, coats, other clothing, a television, an iPod or similar device for the person. Remember that once she is on Medicaid she will not have much money available for these things. Stock up now. The money absolutely cannot be given away, but it is not restricted to healthcare and home maintenance (according to my attorney).

Best you use a little of that money to consult a professional about your particular circumstances.

My mom has no money just monthly social security. All money is gone due to a reverse mortgage. I cant get her qualified for Medicaid since she lives with me. Should I hire an elder attorney to help?

My mom has no money just monthly social security. All money is gone due to a reverse mortgage. I cant get her qualified for Medicaid since she lives with me. Should I hire an elder attorney to help?

ValerieK03, yes.

My mom has no money just monthly social security. All money is gone due to a reverse mortgage. I cant get her qualified for Medicaid since she lives with me. Should I hire an elder attorney to help?

I think we all need to hire Elder Care Attorneys. I never thought I would put my Mom in a NH so it was not an issue for me, however Mom is getting worse and I cannot handle her alone, everything is changing and I need help too!

Kepp - so mom still has her home?
How are items for the home - taxes, insurance, utitlites, upkeep. etc - being paid?
Is there a mortgage on the home?

Do you need to home to have a place to live? Or do you have your own home & independently of mom's home? I ask all this because if you need to have the home in order to have a place to live, then I'd suggest putting the majority of the spend-down money on the home. Like paying a years worth of insurance, several months of utilities, etc.

As her caregiver for several years (you will need documentation on this), you can qualify for the caregiver exemption on the property from Medicaid estate recovery.
This is good but often having the house is an issue in & of itself. Realize that Medicaid requires them to do a monthly co-pay of all their income less whatever is your states personal needs allowance ($ 35 - 90 a month). So mom will NOT have any money to pay for things for the home anymore from her SS or retirement. You will have to be paying for everything on the home. This may or may not be feasible. You need to look at your finances to see what can work.

What seems to happen so often is that although family may want to keep the home, the reality is that they cannot afford to pay for all on the home for the possibly many months or years of their parents NH stay. If you are working, then it can work but if you have been an unpaid caregiver, there just isn't the $ to do this. So the house ends up being sold and the $ from the sale goes to a "spend-down" on mom's care. You want to do whatever to make sure that the caregiver exemption gets done so that you become the owner of the property, so that if you need to sell it later on the $ from the sale is yours without any issues with Medicaid. Really you need an elder care attorney to work this out so that whatever is done will be in compliance with how Medicaid runs in your state. Good luck!

Igloo: You need to write a book from a caregiver experience, all the things you have learned. You are a wealth of information.

Rave - thanks.....I think I will title it, "the bad bitch approach to dealing with medicaid & your elders" with the Moonstruck "snap out of it" as it's gif.

None of the maddening mice maze of Medicaid, NH, AL, IL, etc is easy to begin with much less when there are competing family dynamics at play and decisions have to be made when it's a crisis. What I find especially of concern is that overwhelmingly so much of all this is a women's issue and we are viewed with little or no value to what we contribute to caregiving as far as the regulations are concerned. What we do is for free & out of "love & responsibility" with no value placed on it.

Now we don't know the background on keppelish. But her post, like so many, many others on this site reads as a posting from someone who has been long-term caregiver and then when mom or dad needs to go into a facility find themselves with limited finances and the possibility of not being able to afford a place to live. Those years of not being in the workforce is not rewarded, has no compensation and they find themselves at the point of parents house has to be sold either to pay for care or they cannot afford to maintain the house. If Keppelish needs to continue to live in the home and is able to spend-down the money on the house and by doing this gives her several months of breathing room to figure out her (her not mom's) finances, that is better use of the funds than paying the NH.

It's important to know if you elder has a home in just how your state views property ownership and what the Medicaid exemptions are and how they have to be documented in order to benefit from them. Most regulations are written by men with their somewhat limited viewpoint (lol) in the value of free work done by women. The money is there for the NH to be paid, but the money isn't there to pay for family caregivers by & large to do the same at home at a much lower cost than a NH. Based on the 4 NH for my mom & MIL, I'd say 40% of the residents could still be at home if there was a way to pay their caregivers directly. It is a totally inefficient use of $. I wasn't much of a feminist when I was younger (my hubby who is late 60's actually marched in Women's stuff when he was in college in the 1960's, which is something we joke about), but now as a woman in my 50's, I can really see just how much of a disadvantage women are in having the resources we need to age in the US. It's critical that we try to understand how stuff is set up so we can use the knowledge to our best long-tem advantage. Now I'm not about going back to the bra-burning past - omg I totally depend on really good $$ bra's to make me happy - but if I can spread a bit of knowledge, it makes my day.

Igloo: Medicaid is a maze to say the least and within the institution the right hand does not seem to know what the left hand is doing either, which makes the entire situation worse. Your knowledge and insight is appreciated when it comes to this entire mess. I know you have gained your knowledge the hard way.....lived it, I just feel so worn out by everything I am expected to do that by the time evening rolls around and I can sit down to read, my mind goes numb!!!

I was in high school during the feminist movement and I am more than willing to give up my bra although I am sure others around me would appreciate it if I kept it! When I graduated from High School the term "Career Woman" had just been coined. I remember my mother telling me "If you think you are going to be some Career Woman, well you can just get that thought out of your mind!" The only other alternative was "Barefoot and Pregnant." I'll still choose the feminist route for the most part.

Thank you again for sharing your knowledge!

A pretty young girl thinks she has no need to be a feminist. There will always be a man around who is willing to take care of her.

The rest of us know or have learned that life happens, and you can't count on anything to last forever. I'm reading "The Two-income Trap" by Elizabeth Warren and her daughter, which is a real eye-opener about people who try to do the right thing and end up deep in debt. She shows how some of the changes supported by feminists have actually hurt women. (Not most of them, but some.)