Can the Nursing Home Take My Home in Pennsylvania

Can the Nursing Home Take My Home in Pennsylvania?

If you or a loved one need nursing home care, you may be worried about how to pay for it and what will happen to your home. Most people cannot afford to pay for it out of pocket and rely on Medicaid, a government program that helps low-income individuals with medical expenses, to cover the cost. However, Medicaid has strict rules about how much income and assets you can have to qualify, and it may try to recover some of the money it spent on your care from your estate after your death. This can include your home, which is often your most valuable and cherished possession.

So, can the nursing home take your home in Pennsylvania? The answer is not simple, as it depends on your situation and the state’s laws. In this article, we will explain some of the factors that affect your home’s eligibility for Medicaid and protection from estate recovery.

Your Home as a Countable Resource

One of the first things you need to know is whether your home is considered a countable resource for Medicaid purposes. A countable resource is any asset that you own and can use to pay for your care, such as cash, bank accounts, stocks, bonds, etc. Medicaid has a limit on how much countable resources you can have and still qualify for the program.

However, not all assets are countable resources. Some are excluded or exempt, meaning that they do not affect your eligibility for Medicaid. One of the most important exemptions is your primary residence, which is the home where you live or intend to return to. Medicaid will not count your home as a resource if:

You or your spouse live in the home; or
You have a spouse, a child under 21, a blind or disabled child, or a sibling with an equity interest in the home who lives in the home; or
You state in writing that you intend to return to the home if you are able to

These rules mean that, in most cases, you can keep your home and still qualify for Medicaid to pay for your nursing home care. However, there are some exceptions and complications that you need to be aware of.

Your Home and Estate Recovery

Even if your home is exempt from being counted as a resource, it may not be safe from being claimed by the state after your death. This is because of a process called estate recovery, which allows the state to recover some or all of the money it spent on your Medicaid benefits from your estate. Your estate is everything that you own or have an interest in at the time of your death, such as your home, car, personal property, etc.

In Pennsylvania, the state can only recover from your probate estate, which is the part of your estate that goes through the court-supervised process of distributing your assets to your heirs according to your will or the state’s laws.

Selling or transferring your home prior to death is an option but there are issues to consider for this reason please consult with an estate or elder law attorney. For example, if you transfer your home to someone else, you may lose control over it and expose it to their creditors, divorce, or bankruptcy. You may also trigger a penalty period for Medicaid, which is a period of time during which you are ineligible for the program because you gave away or sold an asset for less than its fair market value within the five years before applying for Medicaid. This penalty period is calculated by dividing the value of the transfer by the average monthly cost of nursing home care in Pennsylvania. Therefore, you should consult with an attorney before making any changes to your home ownership.

Your Home and Planning Ahead

The best way to protect your home from nursing home costs and estate recovery is to plan ahead. By working with an elder law or estate planning attorney, you can explore your options and create a strategy that suits your needs and goals. Some of the things that you can do to protect your home are:

Apply for a hardship waiver. If estate recovery would cause undue hardship to your heirs, such as leaving them homeless or without income, you can apply for a waiver from the state. The state will consider your heirs’ circumstances and decide whether to grant or deny the waiver.
Purchase long-term care insurance. This is a type of insurance that covers some or all of the costs of long-term care, such as nursing home care, assisted living, or home health care. By having long-term care insurance, you can reduce or eliminate your reliance on Medicaid and preserve your assets for your heirs.
Create a Medicaid Asset Protection Trust (MAPT). This is a type of irrevocable trust that allows you to transfer your home and other assets to the trust and name a trustee to manage them for your benefit and the benefit of your beneficiaries. By doing this, you can remove the assets from your name and make them unavailable to Medicaid and estate recovery. However, you must do this at least five years before applying for Medicaid, otherwise you will incur a penalty period. You must also give up some control and access to the assets in the trust.

Conclusion

Your home is more than just a place to live. It is a symbol of your life, your memories, and your legacy. That is why it is important to protect it from the high costs of nursing home care and the potential claims of the state. By understanding the rules and options that apply to your situation, you can make informed decisions and plan ahead for your future. However, this is not a simple or easy task, and you should not do it alone. You should seek the help of an experienced and qualified elder law or estate planning attorney who can guide you through the process and help you achieve your goals.