Although the home is an exempt asset for Medicaid, if it passes to the spouse in the nursing home it could be lost to Medicaid. Dennis Toman, Certified Elder Law Attorney, explains important steps to protect the homeplace from Medicaid in North Carolina.
When one spouse is in a nursing home, the house is a protected asset, as long as the other spouse is living at home. However, we still need to take additional steps to make sure that the home is not lost.
For example, let’s say that we got a married couple that’s called Bob and Mary. Bob’s living at home, Mary is in the nursing home and Mary is now eligible for Medicaid. They still have the house, and their house is held jointly because they bought it together and the house is in Bob and Mary’s name.
What happens if one day, Bob has a heart attack and dies? Well then in that situation the house will pass to the surviving spouse, to his Mary. And Mary is in the nursing home. As a result, the house is still a non-countable asset but in Mary’s passing, the house is going to be subject to estate recovery and has to be sold to pay for Mary’s cost of care.
Now, the family said, “well, we’re going to sell that house,” then instead of that house being a non-countable asset, now Mary has cash from the sale of the house. In that situation, those assets will make Mary ineligible for Medicaid.
So if you’re married and you have a house, it’s going to be important that we put the house into the healthy spouse’s name as well as changing the will, so that we can make sure that we protect that spouse who’s in the nursing home, if they are the surviving spouse and they’ll never have to worry about running out of money while they’re in that nursing home.