How to protect home sale proceeds from Medicaid estate recovery in TX?

Question

My elderly dad has been in a nursing home in Texas for 2 years and on Medicaid for 5 years. He wants to sell his home, which has been sitting empty, and intends for me, his only son who is disabled and on SSDI, to keep all the proceeds. I have power of attorney over him. We want to avoid the Medicaid estate recovery program and any penalty period at the nursing home. How can we protect the proceeds from Medicaid recovery while he is still alive and in the nursing home?

James L. Arrasmith · Answer

Your situation requires careful consideration since Medicaid has specific rules about asset transfers and estate recovery. Selling your father's home and transferring the proceeds to you could trigger penalties that might affect his nursing home coverage, as Medicaid looks back at financial transactions for five years. 
 
One potential approach is exploring whether you qualify for an exception to Medicaid estate recovery as his disabled child. Texas Medicaid rules include exemptions for adult children who are disabled and receiving Social Security Disability benefits. You might be able to have the home transferred to you before the sale through a properly documented deed transfer, which could protect both the property and eventual proceeds. 
 
Given the complexity of these regulations and the significant financial implications, you should consult with an elder law attorney in Texas who can review your specific circumstances. They can help structure any property transfer or sale in compliance with Medicaid rules while protecting your father's nursing home coverage and your inheritance rights. Time is crucial in these matters, so reaching out to legal counsel soon would be wise to ensure all steps are taken properly.

Q: How to protect home sale proceeds from Medicaid estate recovery in TX?