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?
Expert Answer
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>