Recently my 78 year old mother had a stroke which required a week hospital and two weeks in a nursing home. While she is currently living at home with my 76 year old father and my brother. My brother moved in with my parents about 3 years ago. While he originally moved in because of his own marital and financial problems he has essentially has been assisting both of my parents. My father fell last May and after a week in the hospital was able to return home. The injuries from his fall have limited the amount of care he can provide for my mother. My parents live primarily on social security and a small pension totaling about $1600 per month. My brother doesn't pay rent but does provide his own food and utility help. The house was recently paid off and I would estimate is worth about $115,000.
I do not live with my parents, but have been asked to help them with the estate planning. Both parents have wills and I am having them reviewed to ensure they have live directives. I am also working on power of attorneys and getting on their one savings account as a signature authority. The saving account has very little in it and is mostly so that they can cash checks.
I looked into establishing a trust, but was told that with the small amount of cash assets this would not make sense. The penalty of transferring the house into the trust with know other assets to assist with nursing home care would put them in a very difficult situation.
I was told that the house could be transferred to my brother without penalty for Medicaid since he has lived there for over two years and provided care that has allowed my parents to stay in the home. Is this true? If so how is the decision made that the care he provided allowed them to stay in the home for a longer period.
I don't want to put my parents in a worse position and also want to be conscience of my own situation. I would be hard pressed to provide much in the way of cash support.
My parents want to ensure that the house goes to me and my brother. My only concern is making sure that if one parent goes to a nursing home before the other that both can be taken care of.