Your Home and Title 19 (Medicaid)

"Will the state take my home if I go on Medicaid?"
"Can I keep my home if I go into a convalescent home?"

July 2007

When is a home excluded (not counted) in deciding if you are eligible for long-term care Title 19/Medicaid?
When must my home be sold?
What is a lien and when can a lien be placed on my home?
When can the state seek repayment of Medicaid funds paid out?
Can I give away my home?
For more information

Your Home and Title 19 (Medicaid)

Many people are concerned about home ownership and Title 19 (also known as Medicaid). If you are receiving, applying for, or thinking about applying for long-term care Medicaid, answers to questions about what will happen to your home are important to you and your family.

This pamphlet will help answer these questions. (Please note that this pamphlet does not apply to "traditional" Medicaid, also known as "community" Medicaid.)  Please keep in mind that the rules are very complicated, and you should consult a legal aid or private elder law attorney who is knowledgeable about Medicaid law for more detailed information. This pamphlet talks about

• when a home is excluded (not counted) in deciding if you are eligible for long-term care Medicaid,
• when the state may place a lien on your home,
• what happens if your home must be sold, and
• other questions about your home.

If you have questions about Medicaid and nursing home care, see the legal aid pamphlets Paying for Nursing Home Care with Title 19 (Medicaid), and Are You Considering Nursing Facility Care? or speak to your local legal aid or private elder law attorney who specializes in Medicaid law.

When is a home excluded (not counted) in deciding if you are eligible for long-term care Medicaid?

Your home is not counted as an asset in deciding if you are eligible for long-term Medicaid if:

• You live in the home and your equity interest in it is $750,000 or less.

  • The recent enactment of a new federal law, The Deficit Reduction Act of 2005 ("DRA"), has allowed Connecticut to place a $750,000 limit on an individual’s equity interest in the individual’s home. The limit does not apply if the Medicaid recipient’s spouse, child under 21, or adult blind or disabled child, lives in the home. The DRA does allow an individual to reduce his or her home equity interest without penalty through reverse mortgage or home equity loan.  However, there will be a penalty if the equity interest proceeds are given away.

• You are temporarily absent from the home due to certain reasons, but you will return.
  
• You live in a nursing facility (convalescent home), but one or more of the following close relatives lives in the home:

1. Your husband or wife (spouse).
       If you are in a convalescent home, the law also provides for the spouse in the convalescent home on Medicaid to first give income and then, if necessary, give assets to the spouse at home to prevent financial impoverishment and to cover "excess shelter costs." Please see the pamphlet Paying for Nursing Home Care with Title 19 for more information, or call legal aid or a private elder law attorney who is familiar with Medicaid law.
2. Your child under age 21. 
3. Your adult blind or disabled child. 
4. Your sister or brother who also partly owns the home and has lived there for at least one year before you went into a convalescent home.

• You are institutionalized in a hospital or convalescent home but you intend to return home. In this case, there are certain things you need to know:

1. Connecticut requires medical evidence that it is possible for you to be cared for at home. Please consult a local legal aid or private elder law attorney who knows Medicaid law if you need information or have questions about this requirement.
2. A limited home maintenance allowance is available to pay for certain expenses, including rent or mortgage, for up to six months if you are on Medicaid and are reasonably expected to return home within that time.

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When must my home be sold?

If you are permanently in a convalescent home and on Medicaid, and none of the close relatives listed above remains in the home, you must make good faith efforts to sell your home at fair market value. This good faith effort includes preparing for selling the house, and, in most cases, listing the property with a realtor and/or posting a "for sale" sign on the property.

When your home is sold, if your assets (including what you were paid for the home) are more than $1,600, you will be ineligible for Medicaid until your assets are once again $1,600 or less.

NOTE: If somebody has lived with you and provided care for at least two years to keep you at home and avoid institutional placement, please carefully read the information below - "When can the state seek repayment of Medicaid funds paid out?" and "Can I give away my home?".

What is a lien and when can a lien be placed on my home?

A lien is a claim on real property, including homes, to secure a debt. If your property has a lien on it and the property is sold, the lien-holder must then be paid back. No lien may be placed on your home as long as you or your spouse lives in it.

A lien may be placed on your home if you are on Medicaid, are permanently placed in a convalescent home, and are not reasonably expected to return home. (See exceptions below).

However, no lien may be placed on your home even if you are on Medicaid and are permanently in a convalescent home if any of the following close relatives continues to live in the home:

• Your spouse.
• Your child under age 21.
• Your adult blind or disabled child.
• Your sister or brother who also partly owns the home and has lived there for at least one year before you went into a convalescent home.

Before a lien may be placed, you must be given a written notice by the state. If you do not believe the state should place a lien, you have a right to request an appeal called a Fair Hearing.

For more information, please call your local legal aid or private elder law attorney who is knowledgeable about Medicaid law.

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When can the state seek repayment of Medicaid funds paid out?

Connecticut must recover (seek repayment of) any correctly paid Medicaid benefits from the estates of Medicaid recipients who received institutional services, or from anyone over the age of 55 who received Medicaid services. However, no recovery may ever be made of properly paid Medicaid benefits until after you and your spouse are deceased, and then only if you have left no minor child or no blind or disabled child.

Furthermore, no recovery by lien enforcement against your home may be made as long as any of the following close relatives continues to live in the home:

• Your spouse.
• Your child under age 21.
• Your adult blind or disabled child.
• Your sister or brother who has lived in the home since at least one year before you went into a convalescent home. (Note: There is no requirement of an ownership interest).
• Your child who lived in the home for at least two years before your institutionalization, and whose care helped you to remain at home, instead of being institutionalized.

For further information, call your local legal aid or private elder law attorney who is familiar with Medicaid.

Can I give away my home?

NO, except in limited circumstances. Do not ever give away your home, real estate, or assets without first consulting a legal aid or elder law attorney who is knowledgeable about Medicaid law.

There are complex rules and serious penalties for gifting property to qualify for Medicaid coverage of long-term care in a nursing home or under the Connecticut Home Care Program for Elders.  Please see the legal aid booklet Paying For Nursing Home Care with Title 19 and consult a knowledgeable legal aid or elder law attorney for further information.

Generally, transfer of a home will not result in a denial of long-term care Medicaid, if title to the home is given to the following relatives:

• Your spouse.
• Your child under age 21.
• Your adult blind or disabled child.
• Your sister or brother who also partly owns the house and has lived there for at least one year before you went into a convalescent home.
• Your child who has lived in the home for at least two years before your institutionalization, and who can prove that he or she provided care during that two-year period which helped you to remain at home, instead of being institutionalized.

However, there are tax implications whenever title to a home is transferred.

REMEMBER:  Do not ever give away assets, including your home, before consulting with a knowledgeable attorney!

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For more information:

Statewide Legal Services: (860) 344-0380 (Central CT & Middletown)  1-800-453-3320 (All other regions)

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This pamphlet was produced by the Legal Assistance Resource Center of Connecticut in cooperation with Connecticut Legal Services, Greater Hartford Legal Aid, New Haven Legal Assistance Association, and Statewide Legal Services.

The information in this pamphlet is based on the laws in Connecticut as of July 2007. We hope that the information is helpful. It is not intended as legal advice for an individual situation. If you need further help and have not done so already, please call Statewide Legal Services (see above) or contact an attorney.

Copyright:  July 2007