He recently moved from Florida to Texas and is living in a nursing facility in TX. I'm trying to change Medicaid from FL to TX but facility is saying he has too much money (although he has nothing but a car worth $1.5K that's paid for, life insurance policy that I'm paying for and a bank account of $2K). Why am I cashing in a policy that's in his name but I'm paying for it?
Good idea to check all of this out.
Carol
Like 'pinky1', I also bristle when I hear complaints about "the State" taking a parent's assets to pay for care. Medicaid is an entitlement program (like food stamps or Section 8 vouchers). Its purpose is to pay for care for those who cannot pay themselves. If you have assets, you must first use them to pay for your care, then "the State" will pay. The popular notion that the State "takes your money" is inaccurate. The State acts as a middle man so that care can be started immediately. They begin paying the nursing home for you while you sell any assets that are not liquid, then they recover that money from you. Would you rather the alternative...you're discharged from the hospital needing skilled nursing care and you sit at the curb while your house is sold or your insurance policy is cashed in!
That said, many states allow certain expenses to be paid from assets before the money must go towards nursing care. Often, you can pre-pay for the funeral. It's unfortunate that many don't know this and wind up footing the bill themselves when it could have been paid. Even for someone with minimal assets, it is so worth sitting down with an lawyer, just to get some good advice. I spend only $200 for an hour with a qualified elder law attorney and she steered me clear of what would have been a very expensive mistake. Get all your paperwork and questions together and make an appointment.
For the insurance, the ? Medicaid need to know is ownership of the policy and whether it has any cash value which would be an asset of the owner. So who owns the policy? If you own the policy, then it's not dad's asset and it should not have been listed as his asset. But if he owns the policy, even if you or another kid pays the policy, then it's his asset. If it has a cash value, the cash value has to spent down on his care before Medicaid will pay. If the policy is over a set amount, the state can ask for details on the policy as to beneficiary. If the policy beneficiary is his estate, then you can expect the state to file a claim (this would be a Class 7 claim for TX probate) for the proceeds from the insurance policy to repay the state for his Medicaid costs. This ability is indicated in the Medicaid application as "Acknowledgement of Participation". MERP for TX is now being out-sourced too.
Would a better system involve judging whether the child who eats the food bought with food stamps is more or less deserving of tax dollars than someone who "worked and paid taxes his whole life" but, for whatever reason, finds himself with very little money and needing expensive care in his old age?
Does it change the equation if the 'hard working' man gambled and drank away all the money he could have saved for retirement. Or if the child's parent is an unmarried drug addict or a struggling minimum wage worker? Who decides? A social worker, a judge? Some people seem to feel that they (or their parents) do 'deserve' the benefits and others, because of their employment status or perceived laziness, do not.
The programs exist for those who are in the circumstances determined to qualify for them.
No one is able to look into the heart and soul of any individual and judge whether they are deserving of mercy and charity. In our civilized society, we choose to not simply step over the bodies of the poor in the street, whether those bodies be of saints or sinners, they get help when they need it, simply because they need it.
If he is the owner, he has to use the cash value to pay for his care.
I completely understand how you feel. My parents were never able to provide for me and I managed for myself since I was VERY young. Many years later in life, I ended up caring for my mother's every need in my home for 10 years prior to her nursing home admission (KY). Just as I've done all of my life, this was done without any public or private assistance. However, I had to mollify my husband with the idea that "one day we will recoup at least a fraction of these expenses from her insurance policy," assuming there would be any left after the funeral. Now that won't be the case. I had to designate my Mom's whole-life as a "burial policy," and sign the entire proceeds irrevocably to the funeral home before she could qualify for Medicaid. She only gets to keep $40 of her SS money for her personal needs, so I end up paying the $72 per month in premiums, plus $100 for DEPENDS because she cannot manage the tape-on style of incontinence garments the nursing home provides. There are other odds and ends, so our fixed income takes a $200 monthly hit that we did not anticipate.
I don't mind missing out on any “inheritance” proceeds, nor do I have a problem helping provide for my mother - what I DO mind is dipping into my husband's carefully saved retirement to get it. The conflict is gut-wrenching; so at the age of 62, I'm having to go job-hunting again. With the taxes I still pay, and my mother having been a gainfully employed taxpayer in her own right for 50 years or more before her illness, all of this has been a bitter pill to swallow, discovering that she did not merit any better than she's getting. I've had to take a step back and adjust my thinking about this matter in recent months, and as soon as I can eliminate the need to "Rob Peter to Pay Paul," I will feel a whole lot better. People need to know that planning for your own retirement is not (and has NEVER been) enough. Wish you the best of luck in the trauma of dealing with bureaucracy. It’s never easy.
You can use some of the money to pre-pay his funeral expenses. Everything else goes toward his care at the facility. If you want to keep the life insurance money, bring your father home & take care of him yourself/
I do wish that we could find a way to lower the cost of elder care in the US. Keeping parents at home when it is possible is a good way, but often not practical. What I would really like to see is some entrepreneurial spirits open facilities that are nice and not so profit oriented. Sometimes I feel like people view elders as a cash cow. Personally I am glad that Medicaid is there to fall back on. It doesn't take long for end-of-life care to go through what looks like a good bit of money.
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