INTRO: the Medicaid rules are complicated and ever-changing. There is a new Ohio Supreme case you must know about to protect your home and a new interpretation of Powers of Attorney that is incomprehensible.
Q. First let's discuss the new case that can claim the house of a married couple. That sounds terrible.
A. Well, it is terrible. For a married couple, if the residence is in a simple revocable living trust at the time that the first spouse enters a nursing home, Medicaid will not exempt the house like it should be for the spouse still living at home, it will count the house as a part of the assets that have to be depleted. That could mean the house is lost.
Ohio's legislature tried to pass a new law that would change this outcome so that the spouse at home would be able to keep the house even if it was in a Trust when the ill spouse went to the nursing home. Governor Kasich vetoed this important law change because he said the Ohio Supreme court was deciding this issue.
Q. So, what did the Supreme Court say?
A. In the Atkinson case, the couple put their house into a trust in 2000. In April 2011 Mrs. Atkinson entered the nursing home. In August 2011, the house was transferred back to her, and then she transferred the house to her husband. The Supreme Court voted 4-3 to say that the transfer of the house out of the trust and then to Mr. Atkinson was an improper gift from Mrs. to Mr. in excess of the amount of assets that Mr. was allowed to keep and therefore caused her to be ineligible for Medicaid.
This was true even though if the house had not been in a Trust at the time Mrs. entered the nursing home the house would have been exempt and protected. So, this is now the law of Ohio!
Q. That does sound horrible. What should people do?
A. If you are married and you home is titled in the name of a revocable living trust, TAKE IT OUT IMMEDIATELY! You can't risk it being in the Trust if one of you unexpectedly gets sick and must go to the nursing home. YOU COULD LOSE YOUR HOME! Plus there may be more planning you need to do. See a certified elder law attorney for help.
Q. If that wasn't bad enough, what is the rule change that just happened?
A. One of the most important documents that you can have is a Durable financial Power of Attorney so that you can name someone else to take care of your financial affairs should you become incompetent. This document allows you to deal with banks, cars, retirement accounts, investment and the like. BUT NOW, it won't let you file a Medicaid application for your mother!
Q. What, why won't Medicaid accept this legal document that everyone else does?
A. We don't know! Now, the rule is that if the applicant personally can't file and process a Medicaid Application on his own, ONLY HE can appoint someone as the "Authorized Representative" to handle things.
If the applicant is not competent, then a Guardian must be appointed in Probate Court to handle or to name an "Authorized Representative" to handle the application. The POA is no longer recognized as a person who can make the application or name someone else (like your certified elder law attorney) to handle the application.
Q. What are people supposed to do?
A. That's a good question. The rules say that the Medicaid case worker can appoint someone as Authorized Representative. But it may be someone you don't even know! This is another troublesome Medicaid rule designed to make the application process harder and to allow them to deny benefits.
Again, you need to consult with a certified elder law attorney for assistance!
CLOSE: These changes are unfair to every day middle class people who are simply trying to obtain a little help with long term care costs in a nursing home. The Government doesn't seem want to provide that help Plus, there are MORE law changes coming in 2016 that will complicate things even more.