My mother went from private pay to Medicaid pay in her nursing home January 1, 2013. She now has zero money and all of her Social Security goes to the nursing home ... Should I sell [her] home and effectively turn all of the assets over for her care or wait until her death, at which point Medicaid will take the proceeds from the sale of the home anyway?
The move to a nursing home is a big step. It is a major life transition for all family members. Your loved one will no longer be living in their own comfortable and familiar home. In addition, there is the issue regarding whether to retain or keep the home given the unpleasant knowledge that the home may ultimately pay for nursing home care either way.
This dilemma was the focus of a recent Q&A in ElderLawAnswers via the question, "Is It Better to Sell a Medicaid Recipient's Home Now or Wait Until Her Death?"
Essentially, by receiving Medicaid you make certain agreements as to costs and, in the case of nursing home care, the deal often hinges on that most valuable of all assets an elderly person is likely to own: their home. True, it is possible to liquidate and sell the house just to pay for the nursing home care. Although this often reduces or eliminates the costs for maintaining and insuring an empty house, this also means giving up Medicaid benefits until the sale proceeds have been expended for care.
On the other hand, Medicaid will remember your choice whether you sell the home and private pay until spend down or if you to continue receiving benefits in lieu of such sale. If a family member attempts to sell the house after the Medicaid recipient loved one passes, then Medicaid has a lien on the sale proceeds (limited to the amount Medicaid paid for the care of the Medicaid recipient). Either way, the home is subject to pay for nursing home care or to reimburse Medicaid for the cost of care.
The answer to the question posed to ElderLawAnswers hinges on more than a few factors. That said, in most cases Medicaid payments will be less than private pay, sometimes a great deal less. Consequently, the resulting lien may be less of a burden than selling the house outright!
Is there something else at work, however? Notably, is the family home worth keeping in the family? These are situations that require some delicacy.