If we back up why we think a vehicle should only be valued at less than $500, will Medicaid accept this?
Mom is definitely going to need financial aid to remain in assisted living and to receive nursing home care when the time comes. In the meantime, she owns a vehicle that, while valued at a certain amount, really doesn't hold that much value and has decided to give it as a gift to her grandaughter. As her Attorney-in-Fact I am looking for the best way to include a statement in the bill of sale that shows why the vehicle is considered by us to be worth less than $500 (and is therefore safe from Medicaid's viewpoint for her to give away). What I have prepared is a statement including amounts and estimates outlining what my brother has already paid for to keep the car running while using it and the repairs that it would need to satisfy KBB suggested private party value. Is this satisfactory?
First, the Medicaid rule of thumb in your county may be to review only transactions over $500. However, Medicaid case workers have the discretion to question any transaction, regardless of amount. There is no such thing as "safe from Medicaid".
Second,your mother is making a gift of the car to her granddaughter. She may be penalized for this when she applies for Medicaid. If this is the only gift she has made in 5 years, it will be a small penalty. The value of the gift is its Fair Market Value. Thish can be substantiated with a printout from KBB or a similar service. KBB takes into account the condition of the vehicle when calculating the value. Prior or future cost of repairs are not included in the value. So the number you want to use will come straight from KBB>
No offense to the reply; but I need help quickly to figure out what to do with this vehicle. There is NO WAY I would ever pay money for this vehicle, the $3,000 KBB says it's worth is completely unreasonable. Here I have opportunity to get rid of the thing before she "decides" she is competent to drive again, and my hands are tied.
One option is to keep the car in your mother's name. Just take away her license and the keys. Or move the car to another location. As for Medicaid, your mother is allowed to own one car. It will not count for Medicaid eligibility.
Her granddaughter who she wishes to have the car is moving to another state in the middle of August; do you have any advice on insuring the vehicle in that case?
2000 VW Jetta 101,000
Even in another state? Can you elaborate briefly on the advantages of doing that? Who would be able to help me with managing that as far as regitering and insuring it?
If your mother owns the car when she applies for Medicaid, they will not count the car. For Medicaid eligibility, one car is a noncountable asset. The car would have to stay in your mother's name until she has been approved for Medicaid. After that, it can be transferred to her granddaughter. Prior to the transfer, her granddaughter can use the car, but it would have to stay in your mother's name and your mother will be responsible for the insurance.
Alternatively, her granddaughter can buy the car from your mother and pay her back via a loan.