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nursing homes and wills

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  • #1

    nursing homes and wills

    Does someone know the answer to this question?

    My in-laws have willed their house to my sister-in-law. If one or both of my in-laws ends up in a nursing home and runs out of money to pay for their care, will the nursing home be able to come after the house to pay for their care? The house is a two-family and my SIL lives upstairs. She is worried that the house could be taken by the nursing home.

    What about any life insurance policies -- can the nursing home force them to cash them in?
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  • #2
    I think it varies by state, but I can tell you what I found out for the state of OH. MIL has altzheimers and will at some point in the very near future require a nursing home. MIL & FIL have to split their assets and the nursing home gets all of MIL's to pay for her care. FIL is allowed to keep 80k and the house and a car. Once MIL's assets are spent on her care she can qualify for medicaid to pick up the tab. If FIL dies while MIL is in nursing home then his assets will transfer to her. We as the kids will get nothing unless MIL dies and there is $ left. What you need to do is put the assets in a trust but in OHIO that trust has to be in existence for over 5 years because there is a 5 year look back period. I'd recommend seeing an attorney about putting the house in a trust for the SIL. That's my take on it anyway.

    oops forgot about the life insurance policies...not sure if they can force them to cash it in, but I think they will get it at their death if it is on the patient. WHen you go to nursing homes you have to show them ALL your assets, life insurance policies included.

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    • #3
      Why is this ok with everyone? Both of these families have money and assets (a house, a car, a bank account) and they want to hide it so the nursing home can't "come after it" and they can qualify for Medicaid. Why should you be able to hide it and not pay for your mother/father's care? Isn't that fraud, if not legally at least in spirit?

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      • #4
        Lookup "filial responsibility" -- each state has differing rules or laws with regard to this.

        OP is not talking about children's assets... OP is talking about MIL & FIL assets. SIL has a rather unique situation in that she's a third person living in the same house or duplex.

        If she's a third person in this situation, and the two elder persons are of "sound mind" then they should all three visit a lawyer in their state of residence and get these questions answered and resolved before this does indeed become a problem.

        IMO she needs to be on the property title as a third owner in order to safeguard at least a portion of her interests; and even then, depending on the timing of something happening to these aging folks, she still may lose that third of ownership if the state laws can "go back" 5 years to look for assets. The date of the "will" naming her as ultimate inheritor should also be reiterated; but the title needs to change asap.

        I am not a lawyer... the above would be what I'd look into if I were in her shoes.

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        • #5
          Along those lines, I was thinking that it might be good if the ownership of the duplex could be split like a condo so that the daughter could own her side of the building even if a nursing home should ultimately come to own the other side. But that would be a question for a lawyer, too.
          "There is some ontological doubt as to whether it may even be possible in principle to nail down these things in the universe we're given to study." --text msg from my kid

          "It is easier to build strong children than to repair broken men." --Frederick Douglass

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          • #6
            Originally posted by Thrif-t View Post
            I think it varies by state, but I can tell you what I found out for the state of OH. MIL has altzheimers and will at some point in the very near future require a nursing home. MIL & FIL have to split their assets and the nursing home gets all of MIL's to pay for her care. FIL is allowed to keep 80k and the house and a car. Once MIL's assets are spent on her care she can qualify for medicaid to pick up the tab. If FIL dies while MIL is in nursing home then his assets will transfer to her. We as the kids will get nothing unless MIL dies and there is $ left. What you need to do is put the assets in a trust but in OHIO that trust has to be in existence for over 5 years because there is a 5 year look back period. I'd recommend seeing an attorney about putting the house in a trust for the SIL. That's my take on it anyway.

            oops forgot about the life insurance policies...not sure if they can force them to cash it in, but I think they will get it at their death if it is on the patient. WHen you go to nursing homes you have to show them ALL your assets, life insurance policies included.
            Since it is only 80K. Have your FIL gift 12K to you and 12K to another child/relative. I think that is the gift tax exemption. Then lend him money if he needs anything. THat way if he dies the money will not transfer to the spouse.

            Ideally if your parents are older they should be transfering money/assets to offspring to avoid some of the issues you mentioned. I am not an expert - but talk to an accountant because there are probably lots of ways around this.

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