January 4, 2008
Married couples still have effective ways of protecting assets and obtaining Medicaid assistance should one of them need nursing home care. Consider Mable and Harry. Harry is 90 and has been in a nursing home for 6 months. His prognosis is poor and his doctors predict that he will live not more than one year. Mable is 85 and physically strong but she is in the intermediate stage of dementia. She currently lives in assisted living but she will need nursing home care soon.
It is possible for Mable's attorney-in-fact to transfer all of her assets to Harry. There is no penalty for spousal gifts. When Mable was first diagnosed with dementia, Harry changed his Will to leave his estate to the children rather than to Mable.
If Mable needs nursing home care during Harry's lifetime, she will qualify for Medicaid. Harry's assets will not be deemed to her since he is already in a nursing home. They will be treated as two separate cases. When Harry dies, all of the couple's assets pass to their children and Mable remains eligible for Medicaid for the rest of her life.
Next week I will share another neat trick that married couples can use.
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