Good afternoon. My name is Tom Mitchell. I’m a partner with the law firm of Waller & Mitchell. We’re located at 5332 Main Street in Downtown New Port Richey, Florida. I’m an elder law attorney, which means that I do wills, trusts, estates, powers of attorney, living wills, healthcare surrogates, will and trust administration, public benefits qualifications, asset protection, guardianship work. All of those things pertain to the elder law area.
It frequently comes up in my practice that we have a family that has a senior member who has to go to a nursing home. Either they’re in the nursing home now, or they’re going to be going in the next few weeks, and the family wants to try and get the individual qualified for public assistance.
There are several federal and state programs that will pay for the nursing home care of an individual who is indigent. Now, indigency is defined somewhat differently under these federal regulations than you and I might think.
Basically, a single individual can have up to $2,000.00 in assets and get $2,025 a month in income. For a married couple, the person who’s living at home, who we call the “community spouse,” can have $115,000.00 in cash assets, plus the house and the car. And the institutionalized spouse, the person in the nursing home, can only have $2,000.00.
So the problem is: what do we do if the individual is a single person, and they’re only entitled to have $2,000.00, but they have $100,000.00? Or maybe it’s a married couple, and they’re entitled to have $115,000.00, and they have $200,000.00. What do we do about that extra money, to try and get the person qualified for the Medicaid Institutional Care Program benefit, yet still get as much money as possible down to the junior generation?
Well, there’s a technique that we call a Lifetime Personal Services Contract. This comes about because even though it’s your parent, and you might provide care for them and provide management of their medical and personal needs for nothing, that isn’t the law. You’re not required to do that. And so the only thing, under the Medicaid regulations, you can’t do is give money away.
So you can’t give the money away. So what do we do? We sign a contract with one of our children that they will manage our affairs for the rest of our life, and we’re going to transfer money to them now in satisfaction of that obligation. The next question is: “Well, how much money can we transfer?”
And in doing that, we have a calculation that has worked with the Medicaid authorities for many years. Basically, what you do is – you compute the person’s life expectancy. There are tables to do that. You figure out how many hours per month you think that you’re going to be providing these services. You figure out the rate that you’re going to charge.
And currently, in this area, we use the rate that the courts allow for family member guardians. And doing that, you can come up with a number. And that number is the amount of money that can be transferred from the senior generation to the junior generation now, and not disqualify the individual for Medicaid purposes for having made a gift.
So if you’d like to investigate this, please give me a call. This is Tom Mitchell. I’m at 727-847-2288.