@rjm2018 reimbursing yourself for their expenses isn’t a gift. Just keep records. And state laws can affect gift limits. The lookback is meant to properly reserve assets for care, not mean he can’t buy you lunch.
Look at how Medicaid explains, then the state involved.
@lookingforward, yeah, I’m going back year by year starting with the most recent and going through my cc bills and receipts for things that were for them and starting a log. I had started throwing away some receipts this winter to try and declutter, but then I stopped when I got too busy with mom’s health issues. So glad I stopped.
I was told by the lawyer that if the allowable $14,000 per year to each individual was gifted, that Medicaid would expect this gift money to be paid back. I didn’t do any gifting bc I was afraid that, if I needed money to pay for in-home care as they aged, I would have a hard time getting that money back, especially if it were already spent.
I was also told that cash I would withdraw for dad so he could give money to friends and family when they were over for carry out, simple grocery store trips, salt for the softener, etc. could be viewed as a gift of cash to me since I was the one withdrawing it. Dad liked for me to take out $150 to $200 a month for him to spend as he saw fit, but we have no receipts for that stuff. Some months I took out more for when family came in town and, when they were both able to, we’d go out for a big meal or I’d buy food/treats to have small get-togethers at their house. I think he said they only allow $1200 a year ($100 per month) for household spending cash. Maybe he meant that is the amount limit for the at-home parent once Medicaid gets involved in paying for the care of the NH parent. Idk, it was a lot of info in a two hour session and, of course, it wasn’t cheap.
I’m just planning for the worst and praying for the best. This will all, hopefully, be a moot point if they are able to stay and pass away in their own home or they don’t run out of money if we do have to use a NH. That’s how I’d want to go, though - in my own home, in my own bed.
@rjm2018 I think this is State dependent. I’m in CA.
In CA the primary residence can be put into an irrevocable trust. This asset in such a form is then immune from Medicare/Medicaid clawback. It ONLY applies to the primary residence. We just had MIL’s home put into such a trust and it was then sold. While the family is currently using these funds to pay for her memory care there may come a time when she simply doesn’t know anything about what is going on around her. At that point, since the proceeds of the primary residence don’t count as an asset anymore - the family could choose to put her into a Medicare/Medicaid facility
If you aren’t scamming and can document bigger things, I doubt they nickel you over his 200 atm withdrawals. Or 50 to his grandkids for a birthday. They aren’t saying he cant spend anymore, that they’ll assume it’s fraud. Talk to your local govt elder reps, keep reading up.
In my state, they didn’t even have enough staff to pursue paybacks for every case.
@dietz199, from what I understand, CA has only a 30 month look back. I will have to look into an irrevocable trust. There are so many different-named trusts that it gets confusing. Right now, mom is in worse shape than dad. Dad could live on his own at home if mom had to go into a NH. He did really well when she was in rehab for two months with me checking on him often. He has me on speed dial and one of those 911 pendants.
Medicare only covers hospitalizations and mom’s in-home hospice palliative care, mom’s supplemental insurance covered her rehab after a certain number of nights in the hospital with a direct transfer to rehab and NHs are self pay until you run out of money and need Medicaid to step in. This is the way I understand it. Right now they’re both at home and my dad gets home care twice a week paid for by the VA.
“In CA the primary residence can be put into an irrevocable trust. This asset in such a form is then immune from Medicare/Medicaid clawback.”
California elder law attorney here. This isn’t true in California anymore. A normal trust is fine to protect a residence against clawback. If people are contemplating Medicaid planning, please please please do not get your information from “Google, JD”. This includes from me. Every state is different. The law is constantly changing and is very nuanced and complicated. Talk to an attorney face to face.
From the trenches, I can tell you that a lot of the advice in this thread is great. However, I need to add the public service announcement: Beware of financial elder abuse. The vulnerability of our aging population cannot be overestimated. It is an epidemic. Both by unscrupulous scam artists and family members.
The corollary: beware of being accused of financial elder abuse. Banks are mandated reporters, and they will be rightly concerned if a child walks their elderly parent into a branch and gets on all of their accounts – especially if it is apparent that dementia is an issue. And not for nothing, siblings can get quite alarmed to find out after the fact that you put yourself on an account. Don’t do anything in secret. AND, being a joint owner on a bank account means you inherit that account when your parent dies (and your creditors can go after your parent’s account). That may run contrary to your parents’ wishes and send a sibling flying into court to file a lawsuit. The proper way to do it is to go into the bank with the financial power of attorney, and whatever documentation it calls for.
I have to put in a plug from the elder-advocacy standpoint. I know this is hard to hear (I have elderly parents myself) – so long as people have legal capacity, they have the right to autonomy. That means they have the right to make really bad decisions that their kids don’t like. There is almost always tension between a child’s concern for their parent’s safety and the parent’s desire for independence. It is gut wrenching to watch a parent struggle and not live their highest and best life when you can step in so easily, but stepping in isn’t always the right move.
Don’t get me wrong. I applaud planning in advance – the more the better. The more you can support your parents, the better. However, it isn’t ok to force a parent into planning they don’t want (assuming they have legal capacity). Have a family meeting before there is a crisis. Find out what quality of life means for your parent, and what their plan is. Put together the plan with their contribution. Easier said than done, for sure. But there are professionals out there who can help. Communicate communicate communicate.
Finally – read Atul Gawande’s book Being Mortal. It is about the medical industry’s failure to address end of life transitions. Truly profound and helpful for adult children struggling with aging and dying parents.
I have had so many people recommend that book to me. I need to listen!
I stumbled on Gawande’s book. Eye opening and heart wrenching and so important.
Knowing when/if to push parents into planning decisions is a difficult decision. My parents clearly were planners. They sought the advise of the appropriate legal professionals. Their wishes were clear - split 50/50 between their two children. That part was easy.
However, the implementation gets messy. Both parents slowly slid into a mental space where they could no longer make decisions in their own best interests. Luckily, most of the legal stuffage was in place. Dad also surrendered the running of his properties to H and I because he simply couldn’t do it anymore. I’ve have functioned as the medical liaison for many many years.
As stated before, my family runs on trust (the human kind in addition to the legal kind). It works for us. YMMV
@“Youdon’tsay” here is a very long article published in The New Yorker before the book. It is, indeed, a wonderful book.
@dietz199 – I should add, what I am saying above doesn’t mean that the irrevocable trust doesn’t have a purpose sometimes for Medi-Cal qualification. That cash from the sale would disqualify someone if it were in their own name. Qualification is an entirely different issue than clawback after someone dies, though.
That said, There are other Medi-Cal qualification planning techniques other than irrevocable trusts. Because of the possible tax consequences (substantial taxable gain) of selling a home while a parent is still alive, many people do whatever they can not to sell the home at all. But sometimes you have to, esp. for memory care. Again, talk to an attorney who specializes in Medi-Cal planning if this is a decision someone is facing. Every situation is different.
“As stated before, my family runs on trust (the human kind in addition to the legal kind). It works for us.”
@dietz199 – your family is truly blessed. When I get a family like yours in my office, it makes my day. Planners AND trustworthy? I love you and I don’t even know you. 
Unfortunately, I see far more of the non-planning, un-trusting kinds of families. When I started out, a wise planner told me that people’s estate plans usually match how they lived their lives. If there was chaos when they were alive, there will be chaos after they pass. If they are organized and considerate, so, too will be their estate plan. It is totally 100% true.
@CateCAParent is correct, there is a period of time when you and your parent are in limbo, you can see they have lost their executive function, but they can still pass an MMI, can still showtime long enough to convince a judge or physician, etc., that they are competent. When my mother had an MRI that showed brain shrinkage because we were concerned and began Aricept, she had a 26/30 on an MMI. A few months later, in her case, it was much worse, and yet she could, and still does, rise to the occasion and ‘showtime’ for strangers. Really frustrating when she does this for hospice.
My FIL was having small strokes and obviously making bad choices whilst living in his large multi-level home with a big yard and pool to care for plus a disabled wife. It took several years before he finally agreed he could not handle the house, then he went downhill dramatically and yet no one, not staff at the AL, not the MD at the AL, not his PCP, no one would put in writing that he was incapable of decisions. He had a major crush on MILs caregiver, paid her an extra cash amount to stay overnight (outside the agency agreement) and paid her extra cash every weekend, but demanded a hug for it (Eeeew); paid for trips to her home country, and gave her some of MILs jewelry. We were extremely lucky she was ethical or I am pretty sure he would have given her his house to get her to move in with him once MIL died. It was bizarre how outrageously he behaved and how no one in a professional position was willing to take a stand.
Thank goodness my sister took care of legal things when our father was competent. Never pleasant, he’d go kicking and screaming to an apartment (just mentioning it yesterday became a matter of who was going to hang up on the other one first- I did)- going on 93 and memory gone (none for grandchildren, where I live- he can ask 3 times in one minute…). She finally got him to the doctor to be legally declared incompetent (his last visit, a few years ago, he refused any testing). Mom died decades ago.
A reminder- also take care of YOUR legal issues. Have all of the POA, health care POA. living will… documents for yourself and your spouse. We made sure both of us had full power for the credit card we could do so for (it is so annoying when spouses can’t be equals on an account when finances are comingled). Just need to remember to update wills et al every few/five years or so. Last time got rid of need for guardian for son- he’d been on his own for years by then.
@CateCAParent thanks so much for your advice. Fortunately, my family sounds like that of @dietz199. My parents want to make things easier on my sister and me, and there’s mutual respect and trust. But it’s good to think about maintaining their dignity and independence as long as possible. Making things easy on us shouldn’t be the #1 priority.
I am going to order that book right now.
That’s my view - now and always - for my mom (and dad when he was alive) and for H/myself. I’ve told her doctors, my sibling, and anyone else who comes into play that I’m now in charge of mom’s finances and health if I need to be, but ask her what she wants. She’s still in her right mind (with Keppra anyway - amazing to see the difference without it) and I’m supporting whatever she wants. She earned/saved her money and it’s hers, not ours. What she needs/wants, she gets. If there’s any left afterward, I’ll figure it out. Even then she’s given me tons of leeway (in the will and with stuff outside the will) knowing I’ll be fair.
I’ll admit I’m not even concerned if taxes get more than they could have. It’s not worth it bugging her about these things. My taxes all go to things I support anyway - roads, education, medicare, etc. It’s everyone else’s that are spent on the things I don’t support. 
We’ve built our own budget on our own income and investments. It’s why I’m ok with the way my sibling is really messing up dad’s estate due to her inability to handle it. We never expected anything anyway and it’s ok if we don’t get anything. (It’s not the she’s taking it all - she’s losing it all - and this after I had planned to give her most of my share anyway. Some younger adults really can’t handle these things - no real idea why TBH, though I do have guesses.)
After dealing with my mom I said I needed to write a letter to future eyemamom to be opened on my 75th birthday.
It needed to include, don’t be difficult, get on a waiting list for suitable retirement communities. Possessions are just stuff and you can’t take it with you. If you haven’t yet, put your kids names on all of your accounts. Be prepared for things to need to change. Everyone else shouldn’t have to turn their lives upside down so you don’t have to adapt to your new reality.
I say it all with love because it was shocking how my parents had never discussed their future plans. My mom ended up saying she just assumed she would live with one of us but her medical needs were so tremendous it just really wasn’t possible. Or fair to any of us.
My husbands parents are running down the tracks with a light coming straight at them.
And my mother always, for decades, made me promise I’d tell her- and correct her assumptions- when she stopped making sense. But when the time came, she refused my input. Not gentle suggestions, not attempts to be rational.
No dementia, just the aging slowdown, handled her own affairs well. But the rest of it not only made no sense, but burdened other family relationships. (Worse than burdened.)
I’m saying: there can come a point where it’s not all about their preferences, if that adds up to a family trainwreck. Of course we love them and respect as best we can. But we need to consider our abilities, our kids’ needs, what is truly better for our parents care, as well. It’s not as simple as, “Making things easy on us shouldn’t be the #1 priority,” there are multiple priorities, sometimes conflicting.
I think we need to prepare ourselves for the new role of parenting them in the right ways. It’s complex.
All of what we have done and been thru with our respective parents is a guidebook for what we are putting in place for our own children. We’ve had a living trust in place since the first was born. It has been re-stated numerous times.
Our kids both know where my master file resides. The will have access to all account information, contacts, passwords etc. At this point they are not on our checking/savings accounts. They are however on the signature cards of the safe deposit boxes*.
D works for the family business and knows the details. I know some have reservations about letting their kids know their financial status and details. We’ve chosen to have an open book policy now that the kids are adults.
The declaration of incompetence for my mom is very recent. She is in a palliative care program and the NP knows mom and her health status very well. The situation is clear cut. It is so much more difficult (personally and legally) when parents can pull it together for the outside world, as several folks have mentioned. There was a period of time when mom’s friends would not believe m when I tried to explain the difficulties. They just saw someone who could handled a 5 minute phone call or a short visit.
*. Even the best planning runs into glitches. We lucked into one of those large safe deposit boxes and grabbed it when the banker said now or never. (amazing how much paper collects when you are storing the legal stuff for 3 families). Neither of the kids is on that one yet since we all have to go together, at the same time, to set up the signature authorizations. It is high on my priority list to get this fixed.
“While mom is sharp, her hearing is going, but she is too stubborn to look into hearing aids.”
I hope you can encourage her to look. The technology on hearing aids is amazing now. And they are so less obvious than they used to be. They are so small I don’t think most people would notice them.
" I know some have reservations about letting their kids know their financial status and details. We’ve chosen to have an open book policy now that the kids are adults."
I struggle with how much to tell my kids about our financial picture. One, because I want them to have drive and ambition and two, you never know what might happen that could impact that financial picture.
My MIL made poor choices, was horribly disorganized and was highly eccentric all of her life. So it was very difficult to figure out when she crossed into the area where her cognitive functions were affected to the point when intervention was appropriate. I say “appropriate” because intervention was needed for many years, like most of her life.
It’s considered the person’s right, the person’s business to make terrible decisions at age 20, 30, 40, 50 60…but then when do we start looking at that person askance and it’s no longer that person’s right to continue this trend? My MIL had subscriptions to every product that was advertised that caught her eye, to the point that she’d over draw her bank account. Late fees were part of her normal expenses. Her house and properties would go on the auction block regularly and even have to be recovered from the buyer during the grace period after such sales. She’d have her utilities shut off for non payment. Her car had to be towed because she ignored necessary repairs and minor home issues erupted into major expenses because of her neglect. She was a good candidate for that Hoarders show, for 30 years at least, before, we intervened. Should we have? When did we have the right to do so?
For us, that line was crossed when she clearly was endangering her health and needed emergency treatment by all medical standards. But, yeah, we forced her to the hospital, her protesting every bit of the way. We then started cleaning up her mess, without her consent, much less blessing. More like cursing. Yes, the ceilings caved, the pipes burst, the roof had holes, the property was on the point of being deemed condemned, and I rescued one that was sold on the auction block in the nick of time, but it not with her consent. I did three years of back tax returns going through her stuff without her consent. And I doubt she was any less sane when we started the process. Her hospitalization brought her situation to the center stage of our life, and we intervened then. i think if she had fought back in court, we’d have lost at that point. Five years later, she was in a much better place in terms of her belongings, bills, living situation, etc, but it was clear to any and everybody that she was not mentally competent to make those decisions. Several medical assessments confirmed that, but DH did not want to put her through the indignity of being put under legal guardianship. But even then she had days and times when she as cognizant and aware as she ever was, And probably just as incompetent as she ever was too, but now she had intervention.
So, it’s a very difficult process to determine when a person loses the right to make decisions, even poor ones.