Hi all,
My mom has been working on the application for medicaid for my grandfather and asked me to share this:

If your parents give you a check for your b-day, Christmas, etc......have them give you cash instead or use their bank card. That way when you have to apply for them to get Medicaid they don't penalize them. His's was 3years ago to April 2009 for [my aunt]. Important point: if we knew 3 yrs down the road he would need Medicaid, would have sent a money order.

Background: 3years ago my aunt battled breast cancer and my grandparents sent her a series of checks to help pay the cancer bills and for buying holiday gifts for my cousin who is 5 now. This is being viewed by medicaid as a gift and we have to wait out a month long period before re-applying.

Andrea

Andrea -- I think small amounts, like a $20 for a birthday, cause no problem. It's when you start getting into hundreds and thousands that they start to blink.

Carolina,
thanks for the clarification. Yes, in this case, because of the cancer bills it was hundreds of dollars.

Andrea

The money order might not have helped either. That may have raised red flags. With a lot of money, it might have been better to pay the bill directly...it wouldn't have been so obvious the money was for someone else if the check was made out to a hospital, etc.

Any cash, check, etc. given will be found out. They ask for bank statements from all checking, savings and investment accounts and they monitor withdrawals, transfers and checks written.

Small amounts no big deal; the more significant amounts will cause a huge red alert.

Seriously?!?!? Even if the DPOA allows for gifting of certain amounts? Not that my sister and I have been gifting ourselves, not by a long shot. But my sister has been doing the majority, if not ALL of the shopping for my mother. She uses her credit card, then I write a check for the amount from my mother's account. Is this not what we should be doing? The money is being used legitimately for things for my mother, but it's being bought by my sister's credit card. The checks are written directly to the credit card company, not to my sister. Should I be giving my sister the cash from my mother's account? Will that even matter since I am the one taking out the money?

I guess this is another question to ask the attorney. I have SOOOOOO many new questions.

I write out all of my mother's checks since I am joint on her account. All of the checks that I sign are for her bills, nothing else. They are written out directly for her apartment stuff, monthly bills, hospitals, insurance, etc... No checks have been written for anything else, except for my sister's credit card. My sister saved all receipts to show what was spent for my mother, but how would we prove that clothes or drugstore items were for my mother? Not really expecting answers, just writing what comes into my mind.

P.S. Thank you so much for this warning. Must speak to the attorney. I love this site, I learn so much.

Marj - we do the same as you're doing. A monthly check each to assisted living, RX provider. The drugstore where the assisted living orders Depends, etc bills my credit card directly. I pay that monthly with notation "drug store" on the memo line. We have paid for my FIL's headstone and engraving using MIL's checks. The only other checks we write are made payable to my credit card, myself, or my SIL. We write in the memo line what the expense is for, ie/ clothing. We write those checks infrequently enough that I can't imagine being questioned about them. $500/year for clothing/shoes should be well within the realm of normal, expecially for someone who is incontinent and whose clothing is all washed in hot water. I took an advance of $2,000 last November for all the little things I pick up for her. This way I can just pay for them out of her "petty cash" that's available. I have saved receipts for everything I've purchased for her (new linens at one point, paper plates and cups for her "apartment", some decorations, etc.) and it's all in an envelope with her other records.

Marjk
Circle all bills on your sister's credit card statement that are for your mother and then attach the receipts to the statement.

Save drugstore receipts and circle what is for your mother (or what isn't for her).

If you can't reconstruct from the past, do this from now on.

DPOA allows for gifting but medicaid does not (for five year look back.) If you want to pay one of you for services rendered, have a contract drawn up with the lawyer. (This issue was long past by the time we applied but my mother paid for my medical insurance for two years while I was caring for her and her sister...)

The more you're prepared, the easier the medicaid application process can be. (it almost always has some glitches where they ask you to send something you've already sent them...)

Marjk...the large chain drugstores can print out an annual report of all monies spent on medications..it should be under your mom's name as the prescriptions are for her.

I'm sure the state knows your mom has needs...so if the expenses are documented and reasonable, I would hope you would be fine. As long as you aren't buying jewelry and high end items, the questions should be kept at a minimum.

For our tax return, I had CVS (drugstore) print out Mom's RX expense for the whole year of 2008. When I added up the receipts I had, there was a lot more than what CVS printed. I probably could have had them fix whatever they did wrong, but since I had receipts I didn't worry about it, and I think they switched her account in the middle of the year for some reason.

This is just to let you know to double check the list they give you. You don't have to make sure it's exact, just make sure it's "in the Ballpark".

Felicia

I save every receipt for her medications. It's only been a couple of checks that we had to use for my sister's credit card. One was a biggy, it was for furniture for her ALF (which she's now officially not going back). One was for clothes and drugstore stuff. Gifting is not going to happen, it can't. I just realized anyway that the checks were written out directly to the credit card company, not to my sister.

Once we actually unload my mother's apartment and can actually get our hands on her annuities, we should have a good 6 to 7 years worth of money for care (depending on where she ends up). Maybe even a little more. Since we still have a good five years plus, I will start being a lot more careful with record keeping. I just hope someone buys that apartment. Anyone looking to buy a co-op in Manhattan?

Andrea, I think all states vary in terms of Medicaid. Here in NY the examiners would question expenses such as the ones you mentioned but given substantiating evidence, they might give it a pass. Large birthday or holiday gifts might be an issue, though.

All I know is that if your LO has dementia, start keeping records of everything, retain all receipts, and start organizing because you'll want all that information if you need to apply for Medicaid down the road.

Marjk, my mother's financial situation was fairly complex. I gave Medicaid everything they asked for and then some. I also wrote myself checks from her account for items purchased for her on my charge accounts. I attached the receipts to the credit card statement when it came in and then filed it with my mother's information. If Medicaid had questioned me, which they didn't, I would've had the info. As far as the monthly bills go, they will see the checks when they review your mother's checking account. As long as they are regular payments clearly for her care, there's not an issue.

I've completed two Medicaid applications; one for my grandfather and one for my mother. As long as you give them as much as you can up front and they don't have to start digging, the process is easier.

Social Services will send you a list of everything they may ask for, just call them. It's good to know ahead of time.

Dear Marj: MediCal never questioned any checks written for Mom's cost of living. Groceries, prescriptions, utilities, apartment association fees, etc.; none of that was questioned.

I also wrote checks to reimburse myself for prescriptions and CostCo purchases, that too was not questioned. Had it been, I save all receipts, so that would have been okay too.

As for "gifting" that $10,000/year one can give each child, I think there is a possibility that can raise that dreaded red flag; but it is best to ask an Elder Law Attorney about that.

I had no problems or issues in my MediCaid application; it was just a pain in various portions of my anatomy because of all the data and photocopies of things they needed. It was labor intensive, but well worth the work for my mother to get the benefits that she so desperately needed.

Best of wishes,

Johanna C.

I didn't have any issues getting the parents on Medicaid except for a life insurance policy that Dad took out after my brother died. It was a whole life thing, worth nothing, really, as Dad had outlived the policy and the premiums just kept going up and up. It was a 25K policy that had a cash value of about 73.00. God knows how much Dad paid in premiums over the years.I could not find anyone in the company who would tell me what it was worth, with good reason. Thos people should be ashamed. It was holding up the entire application process. It was a knee jerk thing he did after my brother died and they could barely pay to bury him.

He still asks me about the policy. I tell him I have the premiums taken out of his bank account each month. It would kill him if he thought that it wasn't worth anything. It was one of the things he obsessed about when he was at the peak of his sundowning.

Never get a whole life policy. They suck.

Paying for things yourself and then being reimbursed in a lump sum with come back to bite you. You can make it less painful by having every receipt and reason for the expense including the increase in electricity, etc. if they come to live with you. Your total should equal the amount you are reimbursed. Medicaid will question money given to relatives as gifts unless you can prove otherwise. If your proof or reasoning is not good enough you may be asked to reimbuse. When doing the medicaid paperwork I had to explain a wedding gift for a child. And since you are a relative giving care and not a "certified care giver" that is paid, don't be surprised is a physicians note is needed stating that your care kept them out of a nursing home.

Once Mom moved to assisted living, that was the end of gifts for the grandchildren. Money was too tight and her health was spiraling downward. She didn't even think about gifts for them, and they need to realize that life has some ups and downs along the way.