Listing a Medicaid Recipient's Home
Due to our aging population and the rapidly increasing cost of nursing home care, more and more older adults are finding that Medicaid benefits are a necessary evil. Medicaid, as opposed to Medicare, is a government funded program for low income adults who are in need of full time nursing home care. In order for a single person to secure Medicaid benefits, they may only have $1,500 in assets (with some limited exceptions).
If this individual has real estate, there are special rules regarding the sale of the property. First, Medicaid allows the property to stay in the person's name, without being listed for sale, for thirteen (13) months following the first date that they reside at the nursing home and otherwise are eligible for Medicaid. After that time period it must be listed for sale, at its market value, and if an offer is received for 90% of that market value, it must be accepted.
Medicaid considers the County Auditor's value to be the market value. Therein lies the problem, especially considering current market conditions. However, sellers have been able to avoid this potential pitfall by obtaining an independent appraisal of the property and submitting this to Medicaid for approval. If this is the route to be taken, it is highly recommended that you make any purchase agreement contingent on Medicaid's approval. One caveat to keep in mind, each county has its own Medicaid division and it is not unusual to find that what is acceptable in Cuyahoga County is not acceptable in Summit County and so forth. Thus, I would recommend consulting with a local attorney before listing any Medicaid recipient's property for sale.
Brought to you by Christina Hronek, Attorney at Law, Law Offices of Laura Balzano
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