What can I do with Dad's house and not affect medicaid?
(South Carolina )
My 84 year old dad was recently placed into a nursing home, with the medicade application pending. he owes 32,000 on his house, and The fair market value is approximately 51,000... He only brings in about 1200 a month with his SSC payment, and ALL that will be going to medicade to pay for his care.
Bottom line is that he won’t be able to make his house payment. If I sell the house medicaid will take the profit to pay for his care, however what if I was to transfer it to my name and rent it for 5 years?
It just seems strange that the best course of action is to let the bank take the house???Answer:
It's true that a Medicaid recipient cannot divert any part of their income toward upkeep of the home, which may be exempt. So either the family pays the note, or it can be rented out to generate income to cover the debt payment each month. (Some states take the position that renting out the house causes the house to lose its exemption for Medicaid purposes, so you need to check that before renting it out.)
If you cannot rent the house, it can always be sold. The net proceeds can then be invested in a pre-paid funeral or burial, a car, or a Medicaid annuity. All such purchases are not gifts and are exempt assets, so his Medicaid eligibility will not be affected.
You can find out more at medicaid secrets