Can an adult child keep a house from Medicaid recovery?

Walker asked...

In the state of Alabama, there is a family relative that was admitted to a nursing home facility with late stage dementia. The caregiver, a son moved out of the residence once his mother was admitted to the care facility. Prior to that, he lived at the house and provided care. Question, without a will being available, would the son be able to save the house from Medicaid recovery? And thus return to live in the house and possibly bring his mother out for house visits?

Expert Answer

Yes, it's possible for the son who was a caregiver to keep the house without Medicaid having a right to recover the mother's long-term care costs out of the house's value. Medicaid has a special rule to encourage adult children to live with and care for their elder parent, in the parent's home, in order to keep the parent at home as long as possible. If your relative fulfills all the requirements of this Medicaid rule, he could keep the house free from any Medicaid claim on it. These requirements are:

  1. The adult child lived with the parent in the parent's house for at least two years prior to the parent entering a nursing home. Your relative will have to provide some proof of this, such as driver's license or other official document listing the house as his residence during those two years.

  2. During the time the adult child lived with the parent, the child cared for the parent, permitting the parent to live at home rather than enter a care facility. Again, Medicaid may ask your relative for some evidence of this. The evidence could include a statement from his mother establishing that her son took care of her, statements from other relatives who knew the care arrangements, and a letter from the mother's doctor stating that during those two years she was unable to live on her own without assistance.

  3. The parent transfers title of the property to the adult child who cared for the parent. So, in the case of your relatives, the mother would have to transfer title of the house to her son.

To learn more about how this process works in Alabama, your relative can go to the Alabama Medicaid program Web site[]. He might also want to get some free advice and assistance from a counselor at the Alabama State Health Insurance Assistance Program (SHIP)[]. He can contact them by phone at 800-243-5463.