Of course, the
prospect of protecting oneís property and other financial resources
and then going on Medicaid may raise troubling moral and/or legal
questions. The Medicaid program was set up for those who are truly in
need. What your parent may save the taxpayers pay. Over the long
run, unfortunately, these actions destroy the system for those who
truly need it. Furthermore, your parentís money is for their living
expenses not for your inheritance. Once on public assistance however,
this may also mean being provided with inadequate care.
On the other hand,
some argue that wealthier individuals are privy to all kinds of
financial wrangling to protect their estates from taxes, so why
shouldn't people with smaller estates also have some opportunity to do
so on a smaller scale. Your family will need to be guided by their
own moral and political code on these matters.
At the present
time, in many states your parent can protect their assets by giving
them out-right to others, or by putting them in an irrevocable trust
your parent cannot touch or benefit from, according to current
Medicaid law. But this must be done very early in the game.
For the most part,
when an individual applies for Medicaid, officials usually examine
their financial records for the past 36 months to see if any gifts or
transfers have been made within that period of time. Anyone who has
been given a substantial gift or have transferred assets during what
is usually referred to as a "look back" period may not qualify for
Medicaid until sometime into the future. Usually, the individual must
wait for the period of time to pass that would pay for nursing home
care equal to the amount that was given away or has been otherwise
been transferred. However, Medicaid attorneys have found ingenious
ways to even get around this provision in the Medicaid law.