Is there a way to legally sell Mom's house with out losing her Medicaid?

1 answer | Last updated: Oct 03, 2016
A fellow caregiver asked...

Mom is in the Alzheimer's Center with Medicaid paying her way. The only assets that they have left is their home which is paid for--dad is still living there right now so it is protected. He is talking about wanting to sell it & go to something smaller & not as depressing. If we just sell it, mom automatically owns 50% of it & will lose her Medicaid assistance. Is there any way legally that this house can be sold w/o stopping her assistance.

Expert Answers

There is a way for your parents to transfer title of the house so that your father can sell it without it affecting your mother's Medicaid coverage of her nursing home. However, your mother's Alzheimer's may complicate things, so you may need the assistance of a lawyer to make sure things work out correctly. Here's the way it could work.

Medicaid rules allow the transfer of title of the home from your parents jointly to your father as sole owner, with the transfer of your mother's 50 percent interest in the home to your father. If this transfer is made, Medicaid rules then allow your father to sell the home without any of the proceeds being considered as belonging to your mother, and therefore not affecting your mother's Medicaid eligibility.

The problem in your parents' situation is that, depending on how advanced your mother's Alzheimer's condition is, she may not be legally competent to make the transfer. If she is no longer legally competent, the transfer could be made by someone who holds a power of attorney authority to act on her behalf with regard to financial matters, if the power of attorney document gives broad enough authority to make such a transaction. If your mother is no longer legally competent to make the transfer and she did not execute a power of attorney before she became legally incompetent, there is still a possibility that the house might be transferred. That could happen if a family member become a guardian or conservator for your mother and could then make legal transactions on her behalf. Becoming a guardian or conservator requires the preparation and filing of legal papers and an appearance before a judge.

Because of all these complications, and the large amount of money involved with the sale of a home, it is probably worth your father's time and money to consult with an attorney who is an expert on elder care matters (including both power of attorney and Medicaid rules). With the attorney's help, your father will have to try to determine if your mother is still legally competent to make the transfer, and if not, what other course of action might be available to transfer her share of the house.