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Robert C. Gerhard III
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Robert Gerhard’s Answers

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  • Can I sell home owned by medicaid nursing home patient prior to death and keep money in her account till death to repay Medicaid

    Mother in PA nursing home on medicaid more than 10 years. Her only asset is her home.Can I sell home and keep money in separate account till her death to repay medicaid. I can no longer afford taxes on the home. She will be beginning hospice very ...

    Robert’s Answer

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    I am sorry to learn of your mother's transition to hospice care. If you are able to sell your mother's home before her passing, notice of the sale needs to be provided to the Pennsylvania Department of Human Services within ten days. In a prior post I believe I answered your question about pre-payment of estate recovery prior to death, which is certainly one approach, but probably not the best approach. If the real estate proceeds remain in mom's bank account after the sale without properly spending them down to below the resource limit or pre-paying estate recovery, then in that situation the PA Department of Human Services will issue a PA-162 notice discontinuing Medical Assistance (Medicaid) long-term care benefits, assuming you provided the required notice. If the house proceeds are deposited into mom's account and not disclosed to the Department of Human Services then "overpayments" of benefits will occur, and the Commonwealth of Pennsylvania can pursue restitution, including restitution against whoever receives the funds. If the house proceeds are deposited into a joint bank account prior to your mother's passing, it is arguable that they would not be subject to estate recovery upon her passing because a joint bank account is non-probate in nature and in Pennsylvania estate recovery is only against probate property. However, you should be warned that the attorneys for the Commonwealth of Pennsylvania would likely challenge that argument, and assert that the last minute effort to use the non-probate account to avoid estate recovery was a fraudulent transfer. The Commonwealth may or may not prevail on that argument, and the effort may not be fraudulent in nature, but I suspect that litigation with the Commonwealth is a headache you will want to avoid, especially if the net real estate proceeds are modest. There may be other options. If you have been paying the property taxes and maintenance on mom's unoccupied home, you could be entitled to reimbursement pursuant to 55 Pa. Code 258.10(e), ahead of estate recovery. If you are serving as mom's agent under power of attorney and sell the home during mom's lifetime, you should be entitled to reimbursement for the costs you advanced.

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  • Can I sell my mothers home and prepay her medicaid bill prior to her death?? If so which she be disqualified from Medicaid??

    My mother has been in nursing home on medicaid more than 10 years. Her only asset is her home which is worth much less than Medicaid bill. I want to sell her home as soon as possible because of taxes due and neighborhood is very bad. Her home h...

    Robert’s Answer

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    Hopefully there is a power of attorney in place that grants authority to sell the real estate. You should discuss this with mom, if possible, and the family before proceeding. If you sell your mother's home then you would have a duty to report the change to the County Assistance Office (CAO) where the nursing home is located within 10 days of receipt of the sale proceeds. You should send a copy of the listing agreement to the CAO once it is put on the market. Notice off the change is accomplished by mailing a copy of the closing disclosure form you receive at the real estate settlement table, and a photocopy of the check for the net proceeds to the attention of your mother's ongoing income maintenance caseworker at the Pennsylvania Department of Human Services CAO, if you know that person's name. If not, then just send it to the attention of the Long-Term Care Unit of the local County Assistance Office. The nursing home's business office can confirm the address of the CAO, and may know the name of the ongoing worker. What you do with the proceeds after depositing the check in mom's bank account depends on a number of factors, and this is where the advice of an attorney would be helpful. An elder law attorney should be able to save more than you pay him or her, so it is worth hiring one. You do not need to use the proceeds to pre-pay estate recovery, but certainly can do so. Pre-paying estate recovery prior to death with the sale proceeds will avoid a discontinuance of benefits, and avoid the need to re-apply for Medicaid long-term care benefits. If the amount of the check is less than the amount of Medicaid long-term care benefits that have been paid out, then you can pre-pay estate recovery by sending a check payable to the "Commonwealth of Pennsylvania" to Attn. Division of Third Party Liability, Pennsylvania Department of Human Services, Estate Recovery Program, P.O. Box 8486, Harrisburg, PA 17105-8486. Note "Pre-payment of estate recovery prior to death" in the memo line of the check. There is a process they must follow in Harrisburg, so it may take a few weeks for your check to clear, but be assured that it will. I advise my clients to obtain a cashier's check, so the funds are debited from the account, and a bank print-out to prove to the CAO caseworker that the funds remaining in the account are below the applicable resource limit. When we assist with these cases we send a copy of this cashier's check pre-paying estate recovery together with the real estate settlement paperwork, real estate proceeds check, and bank print-out to the local CAO. This is all done within 10 days of the real estate closing. I would recommend that you consult with an attorney to identify options other than to just send the money to Harrisburg. You are permitted use the funds to pay for the attorney's assistance. You may be able to do some other things with the money that are much more helpful, such as replenishing her resource allowance ($2,400 or $8,000) if that has been exhausted over the past 10 years. Alternatively you might be able to buyer her some things or services by the end of the month of receipt of the real estate proceeds. It is entirely appropriate to pre-pay funeral services and cemetery charges (within DHS limits) if that has not already been accomplished. I agree that it is appropriate to sell her home as soon as possible. It is a good idea to use a real estate agent to handle the sale so that it is listed on the multiple listing service. Given the vandalism that has occurred, it is going to be worth less than other homes in the neighborhood. If you sell it directly, such as to a real estate investor, you might find that the Pa Department of Human Services could question whether you sold it for fair market value. Taking pictures and listing the house with a real estate agent and selling the home to an unrelated third party would avoid that problem. Mom should not be disqualified from Medicaid if this is handled properly.

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  • Why doesn't a power of attorney work? I have medical as well. Do i need a guardianship? What are my options?

    Mother has dementia/alzheimers she has a trust. She lives with us. Need to sell her place, car and money for her care.

    Robert’s Answer

    Each state has its own requirements for a POA form to be valid. If the form fails to comply with applicable state law, then a third-party such as a bank may decline to honor the request of the agent named in the POA.

    For example, in my home state of Pennsylvania, power of attorney documents signed after January 1, 2015 need to meet certain new criteria by required by statute. There is a statutorily required “notice page” that must be a part of the document, and the agent named in the document needs to sign an “agent’s acknowledgement” prior to use. Additionally, two witnesses are required under Pennsylvania law, and a witness cannot be the agent named in the POA document. Further, it must be acknowledged before a Notary Public. Failure to attend to these details can render the document unusable. Other states have their own technical requirements.

    A power of attorney also needs to grant authority for a given action or power to be exercised. For example, if you are attempting to sell real estate, a Pennsylvania power of attorney document would typically be specific in granting authority “to engage in real property transactions.” That phrase is further defined by Pennsylvania statutes. The language that works in one state may not be suitable in another. An agent under a power of attorney can only take actions as authorized by the document. Attempted actions which are not granted by the POA are known as “ultra vires” (beyond the scope of the power granted by the POA instrument) and can be denied by third parties.

    Sometimes a valid document is improperly refused by a financial institution when it should actually be honored. In a day of identity theft, third parties are exceptionally careful when a third party is requesting a given action be taken, such accessing a bank account. An elder law/estate attorney can sometimes cut through the red tape to have a power of attorney honored where it has been improperly refused.

    A “power of attorney” is sometimes viewed as a simple document, but that is not accurate, at least in Pennsylvania. A POA must comply with state law and grant the proper authority to the agent. Without a valid power of attorney it may be necessary to file a guardianship petition.

    I see in the facts of your situation a trust is involved. If the assets you are looking to sell are title to the trust then the trust provisions control, and the trustee, not the agent under a power of attorney, would handle the trust assets and follow the distribution guidance as set forth in the trust instrument. The answers to these questions are state specific, so it would be best to consult a local attorney for guidance.

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  • Grandma received Medicaid and I found life ins policy after the fact. Checks were delivered to grandkids. $4000 to each of us.

    We all were named beneficiaries, but I guess should have been given prior to medicaid people by me, three years ago. Their is no estate. I am executer of will though. Should we just keep in a savings account, or what should I do now? I did not...

    Robert’s Answer

    The application for Medicaid long-term care benefits requires full disclosure of assets to the best of the applicant's knowledge. Both Pennsylvania and federal law impose criminal penalties for knowingly and intentionally failing to disclose facts regarding resources during the Medicaid application process. 42 U.S.C. §1320a-7b; 62 P.S. §1408. I suspect that the failure to disclose here was not intentional, so the main potential problem here is likely the existence of an "overpayment." In other words, some Medicaid benefits were likely paid for your grandmother in error because of undisclosed resources. If the state learns of the overpayment, the Office of Inspector General will seek repayment from those in possession of the undisclosed assets, per 62 P.S. §1408(c)(6)(i), even though there is no probate estate. The Department of Human Services' Division of Third Party Liability may be in touch with you. It is also possible, however, that even with the life insurance your grandmother might still have been eligible for Medicaid long-term care benefits. For example, this could be the case if the life insurance policy was a "term policy" with no cash value, even though there was a significant death benefit. In that scenario is entirely possible that no overpayments occurred because your grandmother was not in possession of property in excess of her resource limit. An elder law attorney can review the facts and provide specific advice on the proper course of action. I would recommend that the money not be spent by the grandchildren until it is determined whether or not an overpayment has occurred. If an overpayment has in fact occurred, the lawyers for the Department of Human Services have historically been open to working with those who come forward to set things right. I do recommend that communications with the Department be conducted with the assistance of an elder law attorney who has reviewed the specifics of your case.

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  • Mom in nursehome, Medicaid approved, welfare said to put $6k aside for her for expenses. she died, can we keep it? Pennsylvania

    All her assets were spent down except this expense account - under my name and hers - there is $5,600 left (not much spent on expenses). She passed away 6 months ago, I haven't heard from the state about trying to collect any money. I notifie...

    Robert’s Answer

    A jointly owned bank account should not be subject to Pennsylvania's Medical Assistance Estate Recovery Program because it is a non-probate asset. I have provided a link to the relevant regulation in the Public Welfare Code: 55 Pa. Code Section 258.3(b). You will want to be prepared to supply a copy of the signature card showing the date the account was titled to reflect joint ownership with you with rights of survivorship. The account would still be at least partly subject to PA inheritance tax, which is 4.5% on funds passing to children.

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  • My mother is in a nursing home in New Jersey but intends to return to her home in Pennsylvania.

    Can we apply for Medicaid for her in Pennsylvania? How can we prove Residency in PA that will be acceptable by DPW?

    Robert’s Answer

    According to the PA DPW Long-term Care Handbook and the PA Public Welfare Code, there is no minimum time that an individual must live in Pennsylvania. When a person from another state is admitted to an LTC facility in Pennsylvania, the County Assistance Office where the LTC service is being received must treat that individual as a Pennsylvania resident and decide whether the individual is eligible for MA LTC benefits. (PA Long-term Care Handbook Chapter 423, 55 Pa. Code §148.1) This would also apply if your mother plans to return to her home and would need Medicaid long-term care benefits to cover home and community-based services.

    Technically, an application may be filed by a resident prior to the need of service. 55 Pa. Code Section 125.84. However, I would recommend calling the supervisor of the long-term care unit of the DPW County Assistance Office in the county to which your mother is returning asking whether they will review such an application at this time, if that is your hope. You can also call that county's Area Agency on Aging and ask for help.

    Before moving back to Pennsylvania and applying for MA-LTC benefits, I recommend that you consult with an elder law attorney in Pennsylvania in order to identify potential problems that might occur in the application process. This is especially true if your mother is already approved for benefits in NJ and a move to PA would require a re-application and risk potential disruption of existing benefits.

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  • My 88 year old mother has dementia. Refuses to leave her home. I am her caretaker and she throws me out each week.

    She then calls people crying that she is alone. I have power of attorney. She went into a home for a evaluation and refused to stay. What can I legally do.

    Robert’s Answer

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    This is a worrisome and difficult family situation and one that should be handled with sensitivity. You should consult with an elder law attorney to determine whether guardianship proceedings may be necessary. The authority set forth in the power of attorney document may not be enough to address the situation that is unfolding. Your mother is presumed to have "capacity" and the right to be alone if she wises to be left alone - if she is of sound mind. If, however, she is of diminished mental capacity and is not able to act in her own best interests, then you may find it appropriate to file a petition to be appointed "guardian of her person." Medical testimony would be needed to document her mental condition by clear and convincing evidence. Once appointed as guardian you would then have authority take measures needed to provide for her safety, which could include in-home aides or relocation to a safer environment such as a personal care home or assisted living community. As mentioned earlier, this is a very challenging situation, but one that can be approached by way of guardianship proceedings if necessary. You should consult with other family members before proceeding with a guardianship petition.

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  • Medicare for Nursing Home Care

    My elderly parents live in PA and my dad might be going to a nursing home. When determining the community spouse resource allowance, do you know if the cost of health insurance (almost $500 a month for my dad and $300 a month for my mom) is taken...

    Robert’s Answer

    Generally speaking, the Medicaid recipient's income (dad's income) would be due to the nursing facility less certain deductions. The cost of his health insurance is deducted from what of his income is owed to the facility. I.e., he can keep his supplemental health insurance in place, if desired. There are other potential deductions from income, notably a potential spousal allowance of income if your mother's monthly income is below her "monthly maintenance needs allowance." Absent exceptional circumstances, your mother's resource allowance would not be increased by the existence of a health insurance premium, nor would her monthly maintenance needs allowance be increased. There are ways to increase the resource allowance and spousal income allowance through appeals where there are facts demonstrating exceptional circumstances resulting in undue financial duress. A meeting with a local elder law attorney should result in clarity on this question. In Pennsylvania the resource allowance and spousal allowance of income are fact specific determinations which vary from case to case.

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  • Will the state of Pennsylvania take the home of someone who medicaid took care of in a nursing home?

    The only thing my mother in law had was her home. She passed in January. Need to decide whether to sell the home, or wait and see if the state takes it for taking care of her upkeep in the nursing home.

    Robert’s Answer

    Under Pennsylvania law, the duly appointed personal representative of your mother's estate has a legal obligation to request a statement of claim from the Department of Public Welfare's Estate Recovery Program. Before you become personal representative of your mother's estate, you or the person to take on that role should first consider what is going to be involved, and make some assessment as to whether the estate is solvent. The estate recovery claimi may not be as large as you believe, or it might eclipse the value of the house. An initial meeting with an estate/elder law attorney will help you make this determination. You may want to call the Estate Recovery Program at (800) 528-3708 or write to them at P.O. Box 8486, Harrisburg, PA 17105-8486 to see if the will let you know the amount of the claim before you agree to serve. They have done this in the past for other clients of mine. The Commonwealth of Pennsylvania does not "take" the house in the normal sense of the word, but in the end the house proceeds may well go to the Commonwealth, and we might agree in such situations that they, the state, essentially gets the house. In fact, the bulk of the $36.6 million collected by the PA estate recovery program last year was from the sale of the homes of deceased MA-LTC recipients. The estate recovery regulations can be found at www.pacode.com, 55 Pa. Code §258 et seq. Pennsylvania law places a legal duty on the executor or administrator of the estate to request the statement of claim. If the estate's personal representative does not not properly pay the DPW claim in accordance with the PA priority statute, then that person can be held personally liable to the extent he or she sold the house and misapplied the sale proceeds. Pennsylvania law also allows DPW to administratively assess liability, say if the house was deeded to a family memberby the estate's personal representative without addressing the claim. This would be extreme, and I believe their use of this remedy is extremely rare. If no estate is opened, then the Commonwealth maintains a list of attorneys who have volunteered to administer unadministered estates for a fee, and in that way you might find that the state eventually and indirectly "takes" the house by having a third party appointed to serve as administrator of the estate. In my experience this only happens when the estate is completely neglected and family members do not respond to letters from DPW, or the family of the decedent voluntarily requests the Commonwealth to have someone handle the estate. You should know that there are certain situations where estate recovery is waived, or postponed, especially in instances of undue hardship defined in the regulations, see link below. The estate recovery claim tends to take priority over most other creditor claims against estate assets, but the estate administration fees come ahead of the state's claim, including reasonable executor's fees and attorney's fees. You should know that administering an insolvent estate is definitely not a simple matter, so think twice before taking on the responsibility of serving as personal representative of an insolvent estate. That being said, many of our clients choose to administer their parent's insovent estate even when the majority or all of the estate assets must satisfy the Commonwealth's claim, if for no other reason than they feel a familial duty to conclude a parent's financial affairs. You do not have a legal duty to take on the job, but if you do so then you must handle matters properly or you could face potential personal liability, so definitely hire a lawyer to provide guidance each step of the way. I hope this helps.

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  • Can a senior citizen (83) sell property without losing her medicaid benefits?

    A woman, 83, widow, on medicaid desires to sell rental inherited from deceased husband. She has an offer through a broker. She fears losing medicaid benefits if she sells and uses the funds to pay off all her debt. Is there a proper way to sell an...

    Robert’s Answer

    In general, a recipient of Medical Assistance long-term care benfits has an ongoing duty to report changes to the state Medicaid agency. In Pennsylvania the sale of the real property would need to be promptly disclosed to the Department of Public Welfare's County Assistance Office. In some states you may have the obligation to notify the agency that a given property has been listed for sale. (Hopefully the receipt of the inheritance was already promptly reported. If not then you'll want to be careful about using the sale proceeds to pay-off debt because overpayments of benefits could have occurred during the time when the asset had not been disclosed.) The sale proceeds will likely temporarily place the Medicaid recipient over her resource limit until the excess resources (sale proceeds) can be spent-down. The prompt spend-down of the sale proceeds (excess resources) on her own debts should not give rise to a period of ineligibility for benefits. Be aware that the Medicaid caseworker is likely to scrutinize the debts and want to be assured that the debts are in fact hers, and legitimate. The way to help make sure the sale and pay-off of the debt will not give rise to an improper discontinuance of benefits is to communicate with the ongoing caseworker and let that person know she plans to sell the real estate and pay-off her debt. Request that the caseworker hold-off on discontinuing benefits and promising to send in written verification of the spend-down, i.e., copies of the bills, checks paying the bills, and bank statement or print-out from the bank verifying the payments. By having this advance conversation with the caseworker you are more likely to avoid the discontinuance of benefits and avoid the need to re-apply for benefits. As mentioned in the first answer, you absolutely should have experienced legal counsel providing help during the spend-down. With monthly nursing home expenses being what they are, a mistake here can be quite costly. Hope this helps!

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