Using Unprotected Funds to Improve the Family Home?

This edition of the Koldin Report E-Newsletter is part of a series on Frequently Asked Questions About Medicaid.

All prior newsletters are saved on our website. You can read them by clicking here.

In this newsletter we answer the following question:

If my husband is going to a nursing home, can I use any of my life savings to make repairs and improvements to my family home?

Example: Peter is in a nursing home. Mary is at home. They own their home and combined life savings of $140,000. Under the Medicaid law for 2019, in this example, Mary would be allowed to keep $74,820 and Peter would be allowed to keep $15,450.

This leaves them with $49,730 of excess funds that will have to be spent before Peter will be eligible for Medicaid coverage to pay for his nursing home care.

Although Mary can keep the family home as an exempt asset, she cannot keep the $49,730 of excess funds above the spousal allowance.

One method of protecting some or all of the $49,730 is to spend it on home repairs and home improvements. For example, Mary could pay for a new roof, new siding, new furnace, new kitchen counter top, and a new hot water heater.

Another method of protecting some or all of the $49,730 would be for Mary to sell her current house and buy a more expensive house or condo using the proceeds of sale from her home along with the $49,730 to purchase the new house.

Medicaid will not pay for any of Peter’s nursing home bills until the excess $49,730 is spent towards the nursing home bills and/or exempt items such as improving the family home.

Therefore, the longer Mary delays in spending the excess funds on exempt items, the greater number of nursing home monthly bills she will have to spend towards Peter’s care.

The message here is that Mary needs to act quickly in spending the excess money on exempt items, such as home improvements to maximize the amount she can protect.

The sooner the excess life savings is spent, the sooner Medicaid eligibility can be obtained to pay the nursing home bills.

If you are already ill, even if you are already in a nursing home, there are asset protection options available. However, once you spend your life savings towards nursing home costs, there is no way to get the money back.

For a discussion about how to protect your life savings even if you are already in a nursing home, please visit our website by clicking here.

The Koldin Law Center, P.C. is available to help. We assist families in protecting their life savings even when someone is already in a nursing home.

At the Koldin Law Center, P.C., located in East Syracuse, New York, we have over 50 years of experience helping individuals plan for immediate crisis and long term care. When the Koldin Law Center, P.C. handles a Medicaid case, we not only handle the entire application process, but we also review asset protection options with our clients. We review with our clients who are already in a Nursing Home options to protect some or all of their assets beyond merely establishing Medicaid eligibility. We do not charge a fee for the initial consultation. We welcome your children, family attorney, accountant, and/or financial planner to be present at the initial consultation.

There is something you can do.

Our Attorneys are available to speak to your organization

Our Attorneys speak to groups throughout New York State as a public service. If you would like to arrange for one of our Attorneys to speak to your group, please contact our office.

We appreciate your referrals

We have been told by many clients who are in a crisis that they wish they had known about our firm much sooner. We are proud of the many families we have helped in times of crisis.

We are also proud of the many families we helped avoid financial crisis by doing estate planning in advance.

We all share the responsibility for making our family and friends aware of the planning options available to them.

Your referral to the Koldin Law Center could make a major difference in the lives of your family and friends if they are someday faced with a long term illness.

Remember that the Koldin Law Center offers many services for clients of all ages. Our services range from basic estate planning such as a simple will to complex estate planning including asset preservation planning.

THERE IS NO FEE FOR THE INITIAL CONSULTATION