A common myth that we hear is that Medicaid will take away your home when you apply. Like most myths, there is a thread of truth in this statement, but overall it is not true. Medicaid will not take your home when you apply, but if the Medicaid applicant owns the home when he or she passes away, Medicaid will place a lien on the home equal to the amount of Medicaid benefits used.
If Medicaid spent $60,000 on your loved one’s care during their stay in a nursing home, and your loved one is the owner of the home at the time he or she passes away, the property will have a $60,000 lien placed on it to recoup the benefits spent.
Some states require the home to be sold immediately to pay off the debt. Others will be more laid back, knowing that eventually when the home is sold the debt will be repaid. Sadly, as more states face budget problems, we are seeing a more aggressive approach to recouping benefit amounts through property liens.
There are strategies to preserve the home, but these must be handled by an experienced elder law attorney to work properly.
