Will paying off mom's credit card bill hurt or help her eligibility for Medicare?

Roger k asked...

I've been paying Mothers credit cards,for over a year. Paid three off by paying $500.00 for several months,just to pay off . Now will this hurt her now that we maybe needing Medicaid? Didn't know anything about Medicaid looking back on speending money for 5 years. Never thought about mother going into a nursing home.Here in Texas not sure to keep on paying extra or not? Thank You

Expert Answer

Medicaid is a program to help pay for medical and long-term care -- including nursing home -- costs for people with very low income and few assets. When Medicaid looks at an applicant's finances to determine if she's eligible, they will consider not only current income and assets but also any expenditures she has made within the previous five years. This is to make sure that someone hasn't simply given assets away to family or friends in order to qualify for Medicaid. If Medicaid finds that assets have been given away during this period in order to qualify for Medicaid, eligibility for Medicaid can be delayed for a considerable period of time, depending on how much money was involved.

It doesn't seem that this "look-back" period should be any problem for your mother. First of all, paying off credit cards is not "giving away" money but instead is spending to clear a legitimate debt, which does not affect Medicaid eligibility at all. So, your mother can continue to pay off her debts without it affecting Medicaid. Because you're paying it off through your mother's checking account, it's not clear whether the money being used is actually yours or hers. But that shouldn't matter, either, because Medicaid has no legal interest in what you do with your money.

Medicaid might have some question, however, about whether the money that is showing up in your mother's account is regular income to her. If they believe that it's income, and that the income puts her over the state's Medicaid income eligibility levels, you will have to show Medicaid that the money came from you and was only intended to help pay off her debts. You can do this by showing Medicaid the record of your deposits into your mother's account and the record of the payments to her credit card companies.