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We have been told we must wait five years before selling the home or it will affect Medicaid paying for her care in the nursing home.

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Whenever you sell it all money made will go to Medicaid. The 5 year thing is 5 years before you qualify for Medicaid. It's called a look back. When you apply for Medicaid they look into your financials to see if you are hiding money going back 5 years. Maybe that's what they mean.
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There’s a misunderstanding of what a home sale & “5 Year” means....
Right now home is considered an exempt asset for Medicaid & can stay in that status till she dies. Then becomes an asset of her estate. Mom doesn’t necessarily have to sell home to be ok for Medicaid. But she won’t have any $ to pay house costs. 
But if it is sold whatever proceeds from the sale will become moms income for the month it sold & then afterwards becomes assets of mom. Medicaid places limits on both income & assets; income varies by state but seems to be around $2100; assets limited to 2k. House sale takes her over both income & assets. Mom becomes ineligible for Medicaid. 

To me, how be to be dealing with property sale & Medicaid repercussion really REALLY is interdependent on how much $ the sale is. If there’s an outstanding mortgage or a reverse mortgage, there may not be much actual $ as proceeds from the sale to mom. So if it is a smallish amount, it could - if you plan in advance, like pay for a full pre-need funeral/burial - be a total spend down of the $ within the month of the sale. Mom starts the month within Medicaid compliance figures and ends her month poor once again. So not any Medicaid issues. BUT if it’s a good bit of cash, what’s going to happen is that mom will become ineligible for Medicaid. She will revert to Private pay at the NH and stay that way till she spends down to Medicaid asset limits again. 

But it’s your situation that your brother has been moms caretaker and he kinda needs to stay in the home? If so, Please Please speak with Medicaid caseworker (not NH) as to just how your state deals with Medicaid recovery when recipients are still alive & there is a caregiver exemption for recovery. It’s probably  going to be that you & bro need to get an elder law atty to shepherd your brothers dealing with Medicaid to get the caregiver exemption filed & cleared and get property transferred to his name so IF he wants to sell it later on, he can without any Medicaid issues as House is now in his name. House needs to be all his as only he qualifies as caregiver. 

Otherwise State may need to be repaid for whatever they paid for her stay & these funds may need to come out of the house sale $ first & foremost before any other regular spend down happens. I’d try to get all this determined in advance with a plan so no glitches or surprises when the act of sale happens as some states Medicaid actually can place a lien on the property.
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Gigi - I just reread the thread of another question you asked..... ok, so it seems that mom still has a mortgage? Is that correct? AND your brother lives with her as her full time caregiver but now has his own health issues so between that and moms deteriorating mental state, mom has moved into a NH and gone into the NH as Medicaid Pending (application filed)? That’s it, right? If so, you & bro really need to get an elder law atty ASAP to review the situation to see what options may be possible - like caregiver exemption, mortgage settlement, property transfer, etc. I’d try to get one that is NAELA, as it’s complicated. TX has several and they do not have to be in your county necessarily although that is usually preferable.

Medicaid’s caregiver exemption exists for your brother. But having a mortgage totally complicates the situation as mom cannot just transfer the property to her son as the mortgage has to be released. In many ways this becomes a math problem.... how much outstanding mortgage is, if holder will negotiate & how quickly, what brothers $$ resources are, what you can possibly contribute AND coupled with Medicaid’s compliance requirements. It’s not a DIY project. If moms medicaid or Medicaid Pending, her monthly income (less $ 60 personal needs allowance) should be getting paid to the NH. If so, she will not have funds to pay for the attorney or anything else so you & your brother will need to cover costs.

Now TX does have a waiver that lets the mortgage be paid from her monthly income. It diverts the amount of the mortgage from going to NH as her required co-pay / share of cost, to instead going to pay the note to mortgage holder. My understanding it that it has to be applied for & not done automatically. TX Form H1280 Mandatory Benefit Optional Benefit, it covers “residence maintenance needs”.... like mortgage & avg utilities but not taxes. Ask the atty as to how it might work for your situation. 

Mortgage has to be current as mortgage co will go foreclosure route in a heartbeat often after 90 days of nonpayment. Time is of the essence. Good luck.
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Thank you so much for all the information. Mom has only bee in this home for about six years. The home is in mine and my husbands name along with Mom's. She could not get the loan on the house because of her age. I am headed to Texas tomorrow so my brother and I can talk. Any help with a elder attoryey would be apprefciated. Since my brother has not been able to workwhile caring for Mom it would be wonderful if there was a way to get residence maintenance needs approved. He only gets a very small retirement as a former teacher and I get less that $700 a month social security. How would we get an attorney that is NAELA? Please send any more information that might help us. Mom has not been approved yet since I have to give them all her detailed information. I have P.O.A. for her financials and my brother has the medical P.O.A.
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gigiholik, to find an Elder Law Attorney go to https://www.agingcare.com/local/elder-law-attorneys and you will see an area where you can put Mom's zip code. It should give you a list of Elder Law Attorneys. Or go to the National Academy of Elder Law Attorneys [NAELA] at https://www.naela.org
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