By Daneen Cline
Louise is 78 and has been a resident in a nursing home for 18 months. Her daughter, Pat, has spent all of Louise’s assets to pay for her care and knows that she now must make a medicaid application for her mother. The nursing home provides Pat with the application form and a list of documents she will need, but she must attend the face to face interview with the caseworker at the Department of Job & Family Services. She assembles the required documents, meets with the caseworker and is surprised to find that she is pleasant, seems to understand the situation Louise is in and wants to help. After the caseworker gathers all the information about Louise’s assets she asks about any asset transfers Louise made in the past 5 years. Pat tells her that almost 3 years ago her mother gave each of her 4 grandchildren $30,000 as a gift. At the end of the appointment the caseworker told Pat that her mother was financially eligible for public assistance but the gifts she had made were considered to be improper transfers and because of them, the State of Ohio wouldn’t pay her nursing home bill for 24 months.
As a result, Pat was forced to move Louise to the County Home with the cost being covered by Louise and her daughter Pat.
Louise made one of the most common mistakes there is, she gifted money without knowing what the consequences would be if a health situation occurred. Public Assistance regulations do allow for gifting, but there are penalties associated with them. To gift assets successfully it is important to know what those penalties are and how and when they will be applied. Before gifting is done, a qualified Elder Law Attorney should be consulted to implement a plan that takes into consideration the possibility of a health crisis as well as one that conforms to the necessary regulations.
