JD, CCIM , Real Estate Broker · Tuscaloosa, AL · Member since 2014 · 1k+ posts · 1k+ votes
5y
@William Randall Jones, there is a 5-year look back period when someone applies for Medicaid. If there have been any real estate transfers within the past five years before the application for Medicaid assistance, then they look to see if the person received fair market value for the property. If not, then they take the difference between the fair market value and the transfer price (such as, FMV $10,000, gave away free to a relative for $0) and that is the claw-back amount. Then they divide that number by a dollar amount that changes from state to state and represents the average monthly nursing home cost for that state, at that point in time. Let's say the number is $5,000. If a $10,000 asset is given away, and that would represent 2 months of average nursing home care in the state, then the applicant is in time out for two months. Medicaid will not pay for two months of nursing home care. This is on top of the "no assistance" while they are investigating all of this after application has been made.
There are things you can do, but simply getting assets out of your wife's name is not enough.
JD, CCIM , Real Estate Broker · Tuscaloosa, AL · Member since 2014 · 1k+ posts · 1k+ votes
5y
@William Randall Jones, please clarify what you mean by "to avoid a nursing home getting it." Are you trying to divest of assets in order to meet Medicaid eligibility for nursing home care with just a Medicaid lien on your primary residence? Or are you afraid a nursing home with a judgment or some other claim against you will be able to execute on it? Simply executing a quitclaim deed (the exact answer to your question) might not be the correct answer to the real problem.
JD, CCIM , Real Estate Broker · Tuscaloosa, AL · Member since 2014 · 1k+ posts · 1k+ votes
5y
@William Randall Jones, there is a 5-year look back period when someone applies for Medicaid. If there have been any real estate transfers within the past five years before the application for Medicaid assistance, then they look to see if the person received fair market value for the property. If not, then they take the difference between the fair market value and the transfer price (such as, FMV $10,000, gave away free to a relative for $0) and that is the claw-back amount. Then they divide that number by a dollar amount that changes from state to state and represents the average monthly nursing home cost for that state, at that point in time. Let's say the number is $5,000. If a $10,000 asset is given away, and that would represent 2 months of average nursing home care in the state, then the applicant is in time out for two months. Medicaid will not pay for two months of nursing home care. This is on top of the "no assistance" while they are investigating all of this after application has been made.
There are things you can do, but simply getting assets out of your wife's name is not enough.