Both my parents have been on Nursing home medicaid for 8 months and still own a home. What will happen if they sell it.

Question

My Father deeded his interest in the house to my mother who intern named me as the grantee of a Lady bird deed on the house. Due to the costs we are considering selling the house. There is $100,000 in equity and would like to know if any or all of the following are possible:  
1) Would selling prior to their death trigger a MERP claim  
2) Would they have to go through a penalty spend down period before my mom or both parents can requalify for Medicaid.  
3)Can they gift me $50,000 and use the remaining $50,000 to self pay during the penalty period: $50,000/ $172= 290 days if calculated on just my mom or 145 days if both were penalized (my dad is no longer on the deed). 
4)Can they purchase another home or use the money to purchase an equity interest on my home without a medicaid penalty?

Terry Lynn Garrett · Answer

In Texas the home is exempt as long as one states that one has an intent to return.  Not so the proceeds from selling it.   It is also hard to claim an intent to return to a home one has never lived in.  Whether your parents contemplate the "half a loaf" approach you suggest or a lease which would require the tenant to pay all expenses (families usually wind up paying the property tax), they should consult with an elder lawyer to make sure that it is done right.  For one in your area, trying the Find a Lawyer function on the website of the National Academy of Elder Law Attorneys (www.naela.org)

Q: Both my parents have been on Nursing home medicaid for 8 months and still own a home. What will happen if they sell it.