Everyone’s worst nightmare is losing their home. As you get older, you might find yourself needing extra care, thus moving into a nursing care facility. These facilities are not cheap, and you will need help paying for it. Sometimes if you owe a lot of money, the state or Medicare can step in and cease your home as payment. However, it doesn’t have to end up that way. Depending on your situation, you can avoid losing your home, but you have to know where to start.
Paying For A Nursing Home
Medicare covers many different expenses, but it doesn’t necessarily cover long-term stays in a nursing home. In order to pay for that kind of care, your own bank account will take most of the hit. Many people struggle with paying expensive bills like this, especially over time. As your savings dwindle, you could end up in a tough spot.
However, Medicaid offers a solution to this issue. Already, Medicaid beneficiaries have alleviated their payments using the program, and with great results for those with a fixed income. The only catch is that some nursing facilities don’t accept Medicaid, so it’s important to check before setting your heart on one home.
If this sounds good, the first step is to check if you qualify for Medicaid. One big requirement is that medical care is your biggest financial burden. Luckily, when you apply for Medicaid, their system doesn’t count your home as an asset. So, if you do need help in the future, they won’t come after your house.
When paying for a nursing home, the last thing you want is to gamble with your house. What’s more important, is that if you have a spouse or a relative living in the home, then you will definitely be better off.
So Can Medicare Take Your Home?
The state cannot take, sell, or hold your home in order to recover nursing home care payments.
There is a catch though.
The state paid for your benefits while in care, so they can try to recover those funds through your assets–like your home. If you’re worried about your relatives losing a place to live, then you must take precautions before moving to a facility.
Some of these include a relative or spouse living on the property. In addition, these are more valid options:
Transferring Your Home
Transferring is a great way to guard your property, especially if you transfer it to a relative like your child. Just keep in mind that Medicaid can penalize you for this action if it’s with anyone else, even rejecting you from their program altogether. The good news is, you won’t be penalized if your transfers are to:
- Your spouse
- A child who is under age 21
- A child who is blind or disabled
- A sibling who lived in the home already or has an equity interest (part ownership)
Lien On The Home
Another option is allowing Medicaid to put a lien on your home. This way, the program can earn back the funds they distributed in order to pay for your nursing home.
If you sell your house, then you would have to pay the lien back to the state. There is an exception to this rule as well. If any of the above-listed individuals reside in said house, then you won’t have to pay the lien back.
Hardship Waiver
If a relative moved into your home prior to you leaving for nursing care, they might qualify for a hardship waiver. For instance, if your son moved into the house before you went to the nursing home, and had no other permanent residence, then they can avoid a claim against your house by Medicaid.
When Medicare Can Take It:
Recovery Of The Estate
One unfortunate downside to these loopholes hinges on your relative or spouse. If they die during this process, it puts your house back in danger. While hopefully, you will not run into this problem, it must be mentioned here.
Basically, if the person you transfer to passes away, the state can collect your home.
In order to protect your home, make sure that you are aware of the rules regarding Medicaid and nursing home payments in your state. Every state is different. While Medicaid is a great resource for assistance, you must be careful with your home. If you don’t take proper precautions, you could be betting your house on a roulette wheel.
