"Spending down assets" and the years of "lookback"

[Anonymous]

I know the government will "look back" for several years (5? 7?) to make sure an elderly person didn't just give all their money to their children to qualify for medicaid.


But what if the elderly person didn't give money to their children, but otherwise made foolish financial decisions? Like giving 100's of thousands to charity or political causes?
Or just otherwise throwing away large amounts of money (putting down a several thousand dollar deposit on a living situation, then deciding not to live there and forfeiting the deposit--doing this several times a year so it REALLY adds up!)

Could this disqualify an elderly person from medicaid? And if so--what then? Adult children NEVER received money from the elderly person as adults (as in, not even a birthday card!) and cannot/will not pay elderly person's expenses.

[Anonymous]

Anonymous wrote:I know the government will "look back" for several years (5? 7?) to make sure an elderly person didn't just give all their money to their children to qualify for medicaid.


But what if the elderly person didn't give money to their children, but otherwise made foolish financial decisions? Like giving 100's of thousands to charity or political causes?
Or just otherwise throwing away large amounts of money (putting down a several thousand dollar deposit on a living situation, then deciding not to live there and forfeiting the deposit--doing this several times a year so it REALLY adds up!)

Could this disqualify an elderly person from medicaid? And if so--what then? Adult children NEVER received money from the elderly person as adults (as in, not even a birthday card!) and cannot/will not pay elderly person's expenses.

[Anonymous]

Ask a lawyer but I think it doesn't really matter if the parent did stupid things with her money or not. Good luck!!!

[Anonymous]

From the American Council on Aging:

Unfortunately, Medicaid does not extend an exception to the look-back period for charitable contributions, as Medicaid assumes any gift is given with the intention to “spend down” assets to meet the asset limit. This means that giving to charity during this time frame can result in a denial of Medicaid benefits. While charitable donations are sometimes exempted (not counted), the Medicaid applicant must prove that the gift was for another purpose other than qualifying for Medicaid. That said, it is very rare that a large, one-time donation would be exempted. On the other hand, if the individual gives to charity on a regular basis, this is more likely to be exempted, particularly if there is a long history of giving to the charity.

[Anonymous]

The look back is 5 years. When did your parent give away the money? Did they have a history of regular giving for a long period of time? What state are they in?

[Anonymous]

It’s hard to say. With my loved one someone stole the money from the sale of the house and sold her car and we could not trace the money. I called the police and local agencies and they did nothing. All I could show was who it was not me so they approved it.

[Anonymous]

My question goes a bit further: What if someone gave away all their money to charity, is essentially penniless, and then needs the benefits of Medicaid.

For example, they are elderly with medical conditions that need 24/7 care in a full-time nursing facility.

What does the "system" do with them? Throw them on the street because they gave away all their assets to charity and are not eligible for care?

[Anonymous]

Anonymous wrote:My question goes a bit further: What if someone gave away all their money to charity, is essentially penniless, and then needs the benefits of Medicaid.

For example, they are elderly with medical conditions that need 24/7 care in a full-time nursing facility.

What does the "system" do with them? Throw them on the street because they gave away all their assets to charity and are not eligible for care?

The system Is your kids. They take care of you if you were nice to them.

[Anonymous]

Medicaid does not always look back the full five years. When we were qualifying my MIL for Medicaid, I believe they only wanted statements going back a few months and didn't ask for financial info going farther back than that. So if the money giveway wasn't very recent, then it might not give Medicaid reason to want to look farther back.

[Anonymous]

Anonymous wrote:Medicaid does not always look back the full five years. When we were qualifying my MIL for Medicaid, I believe they only wanted statements going back a few months and didn't ask for financial info going farther back than that. So if the money giveway wasn't very recent, then it might not give Medicaid reason to want to look farther back.

What state are you in. My loved one is in Maryland and they absolutely wanted 5 years of statements and they flagged all checks that were more than $1000. We had to provide a reason for those checks.

[Anonymous]

Anonymous wrote:

Anonymous wrote:My question goes a bit further: What if someone gave away all their money to charity, is essentially penniless, and then needs the benefits of Medicaid.

For example, they are elderly with medical conditions that need 24/7 care in a full-time nursing facility.

What does the "system" do with them? Throw them on the street because they gave away all their assets to charity and are not eligible for care?

The system Is your kids. They take care of you if you were nice to them.

And if you were never able to have kids or your child predeceased you, say in childhood?

[Anonymous]

Anonymous wrote:

Anonymous wrote:Medicaid does not always look back the full five years. When we were qualifying my MIL for Medicaid, I believe they only wanted statements going back a few months and didn't ask for financial info going farther back than that. So if the money giveway wasn't very recent, then it might not give Medicaid reason to want to look farther back.

What state are you in. My loved one is in Maryland and they absolutely wanted 5 years of statements and they flagged all checks that were more than $1000. We had to provide a reason for those checks.

LOL I'm thinking about my mom going bankrupt and we STILL have no idea where all the money went. It would have been an incredible nightmare to have to explain every insane expenditure over $1,000.

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:My question goes a bit further: What if someone gave away all their money to charity, is essentially penniless, and then needs the benefits of Medicaid.

For example, they are elderly with medical conditions that need 24/7 care in a full-time nursing facility.

What does the "system" do with them? Throw them on the street because they gave away all their assets to charity and are not eligible for care?

The system Is your kids. They take care of you if you were nice to them.

And if you were never able to have kids or your child predeceased you, say in childhood?

Poor planning on your part.

[Anonymous]

Anonymous wrote:The look back is 5 years. When did your parent give away the money? Did they have a history of regular giving for a long period of time? What state are they in?

OP here

Just in the last couple years. It's not large amounts, but many many small amounts that add up--$150 to this political candidate, $35 to that political cause, but 100+ times a day! In California.

[Anonymous]

Anonymous wrote:My question goes a bit further: What if someone gave away all their money to charity, is essentially penniless, and then needs the benefits of Medicaid.

For example, they are elderly with medical conditions that need 24/7 care in a full-time nursing facility.

What does the "system" do with them? Throw them on the street because they gave away all their assets to charity and are not eligible for care?

No one is entitled to nursing home care. Basically if there is no family who steps in and they can’t recover their funds, they’re on their own. Sometimes they end up in shelters. Or at their home making due the best they can. If it gets bad sometimes adult protective services might get involved.

There is a hardship waiver but they are hard to get.