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You can own your own home

 and still get Medicaid

NURSING HOME

YOU CAN OWN YOUR HOME AND STILL GET MEDICAID!

That's right! You do not have to give away your home in order to be eligible
for Medicaid. In fact, giving your home away could cause you to be
disqualified from receiving Medicaid. Although you may keep your home

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for as long as you or your spouse are alive, the state may put a lien on your
home so it can recover its costs from your estate unless certain exemptions
apply. (See page 6.)

Medicaid is an insurance program for people who have a low income and
only limited assets or resources. The rules are very strict. This brochure
addresses Nursing Home Medicaid and the fear of losing your home. The
information provided is for educational purposes only and is not intended
as legal advice.

NURSING HOME MEDICAID

In order to receive Nursing Home Medicaid in Georgia, you must satisfy all
the basic eligibility requirements, pass the resource and income tests, and
not be subject to a transfer penalty. You must also be prepared to pay all of
your income to the nursing home each month except $30 for personal
needs. (This goes up to $50 on July 1, 2006.) If you are denied, you have
the right to appeal. Note that Medicaid rules are subject to change, so be
sure to ask about the requirements at the time you apply.

ELIGIBILITY REQUIREMENTS

There are eight initial requirements that you must meet in order to be
eligible for Nursing Home Medicaid. You must:

(1) Be age 65 or over, blind, or disabled;

(2) Be a U.S. citizen or permanent legal resident;

(3) Have or agree to apply for a Social Security number;

(4) Live in Georgia and intend to remain;

(5) Be certified by your doctor as needing to be in a nursing

home;

(6) Reside in a Medicaid certified nursing home for at least

30 days;

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 (7) Apply for and accept all other benefits to which you are
entitled, such as annuity payments, pension distributions,
disability payments and inheritances; and

(8) Assign all third party payments of medical benefits to the

Department of Medical Assistance.

RESOURCES

The resource limit for an individual is $2,000 (if you have a spouse at
home, the limit is $101,540). Resources include all items of value (assets).
However, some assets are excluded from the resource limit. You can own
the following and still be eligible for Medicaid:

(1) The homeplace, including all adjoining land and all

buildings on the property;

(2) One burial contract with a funeral home for you and one
for your spouse. There is no maximum dollar limit;

(3) A burial fund up to $5,000 for you and $5,000 for your
spouse. Any asset can be designated as the burial fund;

(4) Burial plots for you and for your spouse;

(5) Accrued dividends on life insurance policies;

(6) Household goods including furniture, decorations, and

appliances;

(7) Income-producing property, such as a rental house or a

farm. The property is exempt, (but the income is counted
towards the income limit);

(8) Life estate interests;

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 (9) Life insurance policies if the original face value is not
more than $5,000. If the face value is more than $5,000, the
cash surrender value of the policy is counted toward the
resource limit;

(10) Non-marketable assets as long as you are making a

bona fide effort to sell, such as newspaper advertisement,
listing with realtor, or "for sale" sign on the property;

(11) Personal effects such as clothing and jewelry;

(12) Retirement funds such as pensions and annuities if they are

fully amortized based on the recipient's life expectancy and
have a reasonable interest rate.

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 (13) All vehicles regardless of whether or not they are in use.

This means you can own all of the foregoing assets and have additional
assets totaling $2,000 (or $101,540 if you have a spouse at home) in cash,
stocks, bonds, etc., depending on your circumstances. If you are still over
the resource limit after excluding the above items, you will need to "spend
down" your resources before you can be eligible for Medicaid.

INCOME

The income limit is $1,809 per month for an individual. Income is defined
broadly for Medicaid purposes. It includes Social Security, pension
distributions, interest, loan payments, dividends, net rental income, and
money received by gift. Income does not include vendor payments (the
payment of your bills by a third party), the proceeds of the sale of a
resource, dividends on life insurance policies, interest on burial contracts or
funds, or Veterans Aid and Assistance benefits. If your income is higher
than $1,809 per month, you may become eligible for Medicaid by setting up
a special “Medicaid Qualified Income Trust,” also known as a “Miller Trust.”
A trustee puts your excess income into the trust account every month so
that you qualify for Medicaid, then writes a check from the trust to put with
your other income toward the nursing home bill (or other allowed
expenses). If you think you need a Miller Trust, seek advice from an
attorney.

Medicaid makes up the difference between what you pay to the nursing
home and the monthly rate. You may be allowed certain deductions before
you pay the nursing home. If your spouse still lives at home, he/she may
keep enough of your income to bring his or her income up to $2,488.50 per
month. If you have a dependent at home, you may be able to reserve
some of your income for the dependent. As a nursing home resident you
are allowed $30 per month for personal needs ($50 per month starting July
1, 2006). You also may be able to deduct amounts you have to pay for
medical expenses that are not covered by Medicaid like dental care or
eyeglasses. With few exceptions, you must pay all other income to the
nursing home. If your income is used to pay anything other than the
nursing home bill (the patient liability amount after all allowed
deductions), you will risk being discharged from the nursing home for
non-payment.

PENALTY FOR TRANSFER OF ASSETS

Transfers of assets made for less than fair market value (gifts) within five
years before applying for Medicaid may -6- result in a penalty period of
ineligibility. Transfers made to and from most trusts within five years also
result in a penalty.

The "length of the penalty" is determined by dividing the value of the assets
 $ until the death of a surviving spouse,
$ while there is a surviving minor or disabled child of any age,
$ while a child who served as caretaker of the deceased for at
least two years before s/he entered the nursing home is living in the
home, or
$ while a brother or sister who lived there for two years before the
recipient entered the nursing home is living in the home.
In limited circumstances, heirs may also be able to show that the state’s
recovery of its expenses would create an undue hardship.

Note: The 2006 Georgia General Assembly adopted legislation that would
protect the first $100,000 of an estate and require the state to give
individuals notice when they apply for Medicaid about the estate recovery
program. The Department of Community Health has asked whether the
federal government will approve these changes. The state did not have an
answer when this booklet was written. For now, it is continuing to apply its
2004 rules. As always, it is important to consult an attorney for more
information

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.
GIVING AWAY YOUR HOME?
THINK BEFORE YOU SIGN!

Deeding your home to your children (or anyone else) is a permanent

decision, for it will no longer be "your home." If you change your mind, you
are at the mercy of the new owner. The new owner can sell, rent or
mortgage "your home." Most people say they trust their children to do the
right thing. Most children probably will do the right thing, but you must be
absolutely prepared to give up your home before you sign a deed. You
should also consider how such a "gift" will affect your income and property
taxes.

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 This Georgia
booklet Legal Services
is provided Medicaid
forProgram
general information only.
Talk to a lawyerCall Toll you
before Freemake
1-800-498-9469
decisions about ID
Member “spending down”
resources or giving away your home or other assets.

Prepared by Georgia Legal Services Program, 104 Marietta Street , Atlanta, GA 30303
2006

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