How deeply do you really think that Medicaid looks into assets when determining if a person qualifies for Medicaid for AL/NH purposes?

I suspect that increasing computerization is making assets (other than old jewelry hidden under a mattress) easier to find. Corporations are required to report dividends; banks interest, etc. etc. Wherever these is a paper trail, it can be followed. Of course, it can take a very long time before someone gets interested and follows the paper. But keep in mind, that government agencies are very hungry these days and motivated to find hidden assets. Also, I've worked in security for years and can tell you lots of stories, some of them worthy of I Love Lucy, about fall out from what would seem to be a simple scheme to hide money. Think a long time about risking prosecution for fraud. I guess it could boil down to "do you want to eat well, or sleep at night?"

I think a lot of people cheat on their taxes and don't get caught. But that is no defense if one is caught.

Don't take offense, but I have paid MORE than my fair share to our beloved broken system. I was only asking for others input on how far Medicaid reaches, not a morality point of view on what I should and shouldn't do and what's right and what isn't! Doesn't make me guilty to ask does it??

I think that like the IRS, the various federal, state, and county agencies involved in administering Medicaid, make concerted efforts to catch fraud (or mistakes). One state may pursue that more diligently than another; one year it may be a bigger priority than at other times. I have no way of knowing or even guessing what percentage of hiding assets, etc. get caught. Is that what you are asking?

I do know someone on disability who wasn't complying with the rules for working/reporting income (I think inadvertently). This was discovered and he has to repay the money he wouldn't have been entitled to if he had reported correctly, plus significant financial penalties. I know several other people on various government programs, but I have no idea whether they are reporting their financial status in good faith or are hiding some things.

I think the evidence is antecdotal, and since this is not something many people would talk about casually, I think guesses about percentage of fraud detected are just that -- guesses.

You are not expecting a lot of input along the lines of "Well, I've been cheating Medicaid for 4 years and I haven't gotten caught yet" are you? :)

I think that the govt is messed up and probably won't check all that well. I know it is that way with unemployment matters and workers taking money under the table. But a good conscience is like money in the bank. You know no police etc will be knocking at the door with papers for your arrest. An arrest and court battle would cost you far more than you would make with fraud. Better to be cold and hungry than be in jail/or with a record.

If you had asked this ? in 2003/2004 when the new Medicaid rules came about, I would have said it would be hard to find out as the govt was doing it. But not now.
There is a difference in how the review for regular Medicaid (food stamps, TANF) is done vs. the eligibility review for NH/LTC & Medicaid. NH can be done and enforced easier as for almost all there is SS income & retirement income that can be attached and the elderly don't get up and move often so can be found.

But the BIG game changer in Medicaid compliance/fraud is HMS. HMS is a huge company with many divisions - they do all the financials, compliance, eligibility audits, co-ordination of benefits, fraud, abuse, etc for CMS (Center for Medicare & Medicaid Services). They also do more than quite a few BCBS and larger hospital systems.As you can imagine their database is vast and it's very sophisticated. So every cent that is paid for via Medicare, Medicaid or health insurance or other insurance that has a health related claim is likely known by HMS.

HMS (publicly traded) got into doing Medicaid eligibility and Medicaid recovery programs for states about 3 years ago in addition to their existing insurance business. Up until then most states did a feeble attempt at Medicaid recoup as it was true state workers who get their salary no matter what. Now that HMS has it, recovery is viewed from the vantage of a collection agency.With the data they have from the insurance side of HMS, the detail on who you are is just keystrokes away. HMS is big on tight deadlines on challenging things. But that is the job they are given to do under the state's contract with them to recover Medicaid $ and make sure the eligibility is right. About 1/2 the states use HMS and more will do so

if you want to see HMS at work google Randy Drewett TX MERP to see examples of how the state of TX is going after Medicaid recoup via HMS. Drewett is a great solid elder care attorney who has a great website with all kinda info on estate planning for elders. And NO I don't know him or are even close to Beaumont.

Most states have also gotten better on X reference on ownership too with central database on home and any property ownership (cars, boats, etc). So eventually they will find out what those assets are and when they are transferred and the amount. So if you get a penalty for asset transfer it will be done with hard data by the state that determined the amount. Will be hard to refute.

Probate is public document and often on-line, so anyone including the state can find out who inherited what pretty easy if you have the time or reason to dig.

Remember when you do a Medicaid application, you sign off full access to the state system to get data on you wherever.... IRS, retirement, banks, etc. You also have to provide all information on life insurance, so they will know if mom has a term 100K policy and who is the beneficiary.

The brokerage houses send 1099's on all accounts so that will show up too.

The only thing I can think of that is private is if there is a living trust - a real living trust and not those chicken dinner "trusts" marketed to the gullible elderly. LT doesn't go to probate but every single asset must be changed to trust ownership. Anything left out and that part has to go to probate. Imho, LT needs a significant amt of assets to be funded to be worthwhile. If you mom has an LT then you are likely not on this site .....LOL.

Every week in the paper in my area there is yet another person who is getting jail time or a huge financial hit or assets seized for fraud related to $ gotten from FEMA or their insurance company related to Hurricane Katrina. That was in 2005. Six years ago. My point is that likely & eventually it will surface and the penalty will be quite nasty. Some of these were small amounts like 15K but balloon to 40K with penalties. Just not worth it.

Thank you very much, Igloo, for that interesting information.

igloo, I want to commend you. You CLEARLY know your stuff. You are so good, perhaps you work in the industry, or should?!! All of the answers everyone has given on this thread have been wonderful and I could give a "gold star" to one of them - it would be yours!! Thanks so much everyone.

Wow, igloo....as always helpful and complete information...I always learn so much from your posts and actually keep a file of them for future use. I can tell that you have "been there, done that" over the years. Want to run for president?? Got my vote...Lilli

My sister has Alzheimer's or dementia she only gets a little social security and $98.00 pension a month could she get Medicaid? She has a farm that her step-son has been buying from her he pays her $250.00 a month on a contract of deed with balloon payment in 2017 Dec. Untill she gets her money could she get Medicaid? She is failing and I am the only caregiver she has.

a friend of mine almost went to jail for fraud because she hid assets. It's not worth it.

And companies that have publicly traded stocks report who their investors are and how much stock is owned, traded etc. A few years ago my hubby, by accident failed to list ONE trade among hundreds he did that year. Yep - the IRS had it and hit us with a penalty. Big Brother knows all!

Pretty bird - you might want to post your ? again as a "new" ?, as it's linked to one from 2012. Although it was interesting re-reading my answer from 3 yrs ago!

Here 's my thoughts:
because of the existing contract to purchase on the farm I'd bet that her application will get reviewed by a higher level Medicaid staffer than the initial caseworker....and she needs an elder law atty to "shepherd" her application. Her income sounds low enough that it's under the amount. But the farm could be an issue. I don't know about farms but for ranches, they can be an exempt asset even if they are huge (TX ranches are done by sections as you need a lot of land for grazings and could easily be a dz. sections which is over 7,000 acres) as long as its a working ranch. That it is a "working" ranch seems to be the key to being exempt. Farms & ranch income are common enough that there is a ? specifically on ranch income on the annual renewal for TX Medicaid.

If the contract wasn't done by a real estate attorney & so was a more casual agreement, it could have issues to start with. really to be on the safer side, I'd gather up all her & your legal (DPOA, MPOA, old wills, etc) and get all reviewed & updated by elder law atty and have them deal with her application & the paperwork that I'd bet the state is going to need above the usual paperwork.

Do you know if the contact was done as a SCIN (self canceling installment note) if she died before the balloon? These are often used for property sales between family. Medicaid, well, I'd bet they hate those.... But probably something needs to happen to be written to be an adjunct (just what I'm not sure) or whatever to the existing contract so that the stepson doesn't face a Medicaid claim or lein on the farm after your sister dies that could be an issue for him down the road.

I'm going to PM one of the members who has insight on contracts to see if she can come up with ideas as well.

I think they look pretty deeply. As soon as you think that they don't, that is the day they will find what you didn't report. It's just like I can go 35 mph in the speed zone for a month. There can be no cops for miles, but the day I go 36 mph a cop appears out of nowhere.

I'm going to address only the issue of the farm ownership. I'm assuming by "contract of deed" you mean what's typically called a land contract. The fee holder (your sister) retains title until any balloon payment is made. Thus, I BELIEVE the farm would be considered as her property, subject to the interest of her step-son as the purchaser.

I want to emphasize that it's been quite a while since I've worked w/land contracts, and they weren't very commonly used in the transactional law firms for which I worked.

At the time of the balloon payment, your sister would normally execute a Deed C, which is a deed that conveys title but excludes any encumbrances for which the purchaser (your sister's stepson) may be responsible. For example, if he pledged his interest in the land contract and the property as collateral for a loan, the Deed C would exclude that from clear title, since your sister, the owner, wasn't responsible for it.

It's kind of a peculiar situation since your sister really does own the property but is selling it to someone who also has certain rights, but not full ownership.

I'm not at all knowledgeable about Medicaid, but I would say from a legal standpoint the house even though it's being sold on land contract would still be considered her house and an asset for Medicaid evaluation purposes.

I think though that the value of the house would be hard to determine, since (a) she has ownership but a portion of the sale price has been paid, and (b) it will change monthly with each land contract payment, a portion of which is applied to the principal paydown.

So the value of her investment would, I think be the market value less the amount paid by her step-son, proportionately. I.e., if his payments total 40% of the sale price under the land contract, Medicaid might consider that he held a 40% ownership and your sister held a 60% ownership. Again, that would change with each payment.

That's supposition though; I'm applying what I know about land contracts and real estate, but as I emphasize, I am not at all knowledgeable about Medicaid asset determination, especially in a land contract situation.

I meant to add this but it slipped my mind momentarily. Given that your sister has Alzheimers or another form of dementia, depending on the level of clarify she has and whether she's been specifically diagnosed with either Alz or another form of dementia, sheherself may not be legally able to execute the Deed C. That would fall to anyone she's named in a Durable Power of Attorney.

So,igloo, if all the assets are in a Living Trust, the money won't count towards assetss and they would be able to get Medicaid?

Senorita - Trusts, well IMHO, you need to clearly speak with elder aw atty within your state as trusts are totally sticky to deal with. Some states are going into life estates & trusts before Medicaid will pay. Or the existence of the trust will make them ineligible for medicaid. Medicaid is frightfully costly for state budgets so states are going deeper to have the applicant use their assets first & foremost.

One problem that comes up with trusts seems to be that folks hear they can do a trust and they think "it's in a trust so no worries!"! But the trust has to have its own reliable source of funding for the items in the trust over time. A trust is its own legal entity and has costs associated with that entity & needs an income steam to pay those costs. Like say you put grannies house in a trust...so how is all the costs on the house, like taxes, insurance, utilities, etc going to be paid? And paid year after year? If grannie ends up in a facility, she may not have extra $ anymore, so then what? to me & just my non-legal, non-financial professional opinion, is that a trust requires long term financial planning with resources to have the trust work.

So Sra, what are you trying to do??...is it that mom needs a NH and mom has assets & you are trying to find some magic way to hold onto her assets for yourself or for her? If its for her, mom can do a special needs trust for her $ allowed by Medicaid in most states but the beneficiary of the trust will be the state. An elder law atty can tell you what the SNT options are for your state. If its retaining liquid assets for you, that isnt gong to happen as the lookback will find the transferring of moms $.
If mom has a home, that might be able to be kept as an asset & be inherited as per valid will but this approach will require that you pay for all costs on property from now till mom dies and then go through the probate process and deal with MERP. This approach runs risk, and most people are risk adverse.

Thank you igloo. What I was trying for was to protect the money in her ira's and savings from all going into nursing home care if need arises.There are always big expenses on the house. For instance recently paid 8000.00 for new plumbing. So it being possible that she would be able to leave NH and return home, I wouldn't sell the house. But if all her money goes to pay for NH, when she would return she wouldn't be able to afford the house or expenses.Naturally if she doesn't return, the house could be sold and no problems.

prettybird, I would recommend that you make a new post with that question :) It's a good one and deserves more direct answers than you'd get under the heading of another question.

Your Social Security number is attached to everything you have done for your whole life..

Big Brother is always watching..

my dil's grandmother went to nh for rehab, was determined not able to go home, application made for Medicaid and they found the money out of her SS that she'd been giving her daughters, charged her with Medicaid fraud, nh had daughters arrested for exploitation, had court this week, one may have had an explanation and is ok, the other's had an attorney appointed for her, new court date for the 23rd, and told she could be facing 5-10 yrs. in prison

Igloo is right. Medicaid will find all your assets unless they are hidden under the mattress or possibly in a safe deposit box. Your property, your car, your assets all become public knowledge as soon as you file for Medicaid. Nursing homes are awful places to live especially in you are on Medicaid and have little money of your own for the things you need to be comfortable. If there is any other alternative, explore it before locking your parent with dementia in a lockdown facility -- it is just like a jail.

Sra- planning on somehow keeping moms $ liquid (like in savings or 401k) won't ever work for Medicaid. Medcaid requires them to be "at need" both medically (for skilled nursing care) and financially (basically impoverished). Mom can have 2k in assets & her home & a car as exempt assets also. All those funds in her 401, etc will be reportable & will need to clearly have been spent & used in some way on her care, her needs or her property.

Understand that once mom is on Medicaid & in a facility, she is REQUIRED to do a copay of all her monthly income less a small personal needs allowance ( ranges from $ 35 -105 a mo & varies by state). Mom will have no-none-nada of her $$ ever to pay on any costs on her home anymore. If you - for whatever reason - want to have mom continue to keep her home, then you will need to pay all costs on the home from day 1 of Medicaid and then through probate and deal with however your state does MERP ( estate recovery). In my viewpoint, keeping your folks empty house is like paying for all costs on a 2nd or 3rd home but without any guarantee of ownership; so it runs a risk. Most of us cannot afford a 2nd home or like risk; but if you do & have the purse or pocketbook to afford the house from now till past death whether its 6 mos or 6 years and then through probate, then go for it. If there is still a regular mortgage on the home (horror of horrors!!), this could be quite a lot of $$ each mo on moms house.

Yes. People get caught all the time. Medicaid is a government program. The government can read your emails if they are more than 6 months old, can tap your phone, can see your bank accounts unless you put cash in a safe deposit box, and can tell if you gifted an asset because there is always some record of money changing hands. There is a cancelled check or a bank record. There are also tax records and gift tax returns so the government can find out whatever they want. Concerning Medicaid, if they see that you gave any gifts at all to your children 5 years before you apply, they will turn down your application. You cannot give away your assets and then get Medicaid. Sure some people get away with fraud, but take it from a paralegal, most people get caught and don't get Medicaid funding at all.

wish they were faster; this same daughter who has court the 23rd just got her tax refund - with some shady stuff, there, no doubt - to the tune of almost, if not more that mom (grandma)'s short for the whole Medicaid thing

Anyone who does not disclose all the income and assets that are relevant to a request for benefits should be losing sleep over their decision.

To start with, each case worker is audited by supervisors who try to make sure that the applications are being carefully processed and properly approved.

If someone does fail to disclose the true extent of income and assets on a Medicaid application, and it gets past the case worker, the applicant can be assured that their State Medicaid agency will be swapping data with federal and state taxation agencies (IRS, state revenue departments) and other government departments. The bank and other financial institutions file annual reports on all of your accounts with the IRS and state revenue department. All this data is sifted and matched up with any public benefits payments you may be receiving.

It may take time for the data matching to detect a problem, but eventually the problem will be found.

In addition to the routine data matching programs within the state Mediciad agency, states have independent auditing departments which select and focus on certain Medicaid programs. The auditors learn to identify gaps in the application process, and follow up on applications that appear in the screens they set up to hold the Medicaid agency and the applicants accountable.

Data matching applies to all government benefits programs. If an applicant for a VA Aid & Attendance pension "forgets" to mention a bank account on an application, the account will eventually be matched to the applicant and the VA will impose an overpayment for all the money during all the months it had provided reimbursement for care.

It is unfortunate that the government must expend resources on the review and investigation of public benefits expenditures, but without these systems, more people would try to abuse the system, and there would be even less available for people who truly need the help.

We all have a duty to fully and honestly disclose the truth on applications for benefits.

What happens if a parent wants to give his money to a child and does so and has no understanding of Medicaid rules or 5 year look back periods. Then, he gets sick. His son lives in a state with no filial responsibility laws, committed no crime because the gift was willingly given. The son becomes disabled and spends the money for living expenses so it cannot be returned. Does Medicaid offer any help to such people?

Beverly, there is no Son, it's you who has stolen all of your MOTHER'S MONEY, and now you are looking for a way around it! There is no way around it, and now She's all yours until the 5 year look back is clear of you spending Her money on YOU!!! It doesn't matter that you are disabled or mentally ill, it was your Mom's money to last her until it ran out, caring for her!!! There is no way that you can justify spending your elderly Mother's money on YOU!!! YOU, should have found ways to seek Governmental avenues to arrange Welfare for yourself and Your care and wellbeing, but instead, you spent your Mother's money on You! You have said so on many other threads! Quit trying to rip off the government! She is now all yours to care for, just like you said you had every intention of doing so, until the end of her life. You were the one who said that Nursing Homes were dreadful places that people left their parents to go to die in! And now you're looking for a way out of caring for her. Sometimes you speak as if you are the Mother, then the Daughter, and now, the Son, just who are you really? A troll? You've called yourself that name too! You have lost all credibility on these threads, some of which have been dismantled because of your TROLLING! GET A CLUE!

How "broken" would the system be if more people were the honest type. I believe most are honest and play by the rules, but those that aren't sure create more problems, rules and expenses for everyone else. No sympathies from me for anyone who attempts to cheat the system and gets caught.