Assignment # 4

April 8,2011

(A) Marty is a 76 year old Nassau County resident. He owns a bank account valued at $200,000, an IRA account valued at $100,000 and a home valued at $800,000. His total monthly income of $3,000 includes the minimum required distributions from his IRA. Marty has one son that he trusts completely and to whom he would feel comfortable transferring his assets. His son is not a caretaker child nor is he blind or disabled. Marty needs nursing home care – likely for the rest of his life. (a) If Marty were MARRIED at the time of application for Medicaid benefits:
i. Describe an appropriate Medicaid plan under the PRE-DRA 2005 rules.

Well the PRE- DRA 2005 rules indicate a look pack of five years when applying for Medicaid. In this case for Marty with a spouse you can eliminate the house because as long as his wife is still living in the house it would be exempt. As far as his other assets his wife can apply for spousal refusal five years prior and can then transfer assets over to the son. ii. Describe an appropriate Medicaid plan under the POST-DRA 2005 rules.

The Post- DRA 2005 rules indicate a look back of about 60-month look back date. In Marty’s case of being married he can still transfer assets over to his wife or son prior to the 60 months required to look back.

(b) If Marty were UN-MARRIED at the time of application for Medicaid benefits:
i. Describe an appropriate Medicaid plan under the PRE-DRA 2005 rules.
In Marty’s case he could put his home in a life estate transferring over to his son fiveyears priors as well as all other assets to avoid penalties.

ii. Describe an appropriate Medicaid plan under the POST-DRA 2005
IN Marty’s case he could still put his home in a life estate transferring over to his son, but due to the short window he may have to use the rule of halve and transfer half of his assets to his son and be penalized for half of the remaining assets.