Protecting Your home From the Nursing Home.

Medicaid transfer rules are something the average family should be concerned with! The facts are, as we live longer, more than half will spend time in a nursing facility.  

As a general rule, when assets are transferred to others for less than fair market value, this transfer will result in a period of Medicaid ineligibility.

Here are four instances where transferring the family home or principle residence for less than fair market value may be permissible and not result in Medicaid ineligibility or penalty.

First, the principle residence can be transferred to the spouse who is not in the nursing home, the community spouse, without a penalty. In most married situations, the deed is titled as tenants by the entirety. This means that by operation of law when one spouse dies the other would then receive full ownership of the property.

Second, the residence could be transferred to a caregiver child. The definition of a caregiver child is a child of the institutionalized person who has resided in the residence for at least “two years” immediately before the date the person becomes institutionalized. Further, this child must have provided care which resulted in the person living at home rather than in the institution.

Third, the residence may be transferred to a brother or sister who have an equity interest in the property and were residing in the residence “one year” prior to the person entering a facility.

Finally, the home can be transferred to a child of the institutionalized individual who is under the age of 21, or a child of any age who is blind or disabled.