Assisted Living/Retirement Community

6 Replies

Hey BP,

Question here on something that I have researched a bit in the past but unsure on whether this applies to what I read.  I have an extremely strong lead that has said they talked to the executive director of an assisted living/retirement community and they are interested in speaking with me about what I do and seeing if it may benefit some families in this location.

I have done a lot of research and I know that I have read often times this is NOT possible due to Medicaid.  I told my contact this and I was told that this is a private facility and financing for the patients in the facility is not done through Medicaid but rather done privately.  If this is true would this allow me to have an opportunity to pursue this?  Any help would be greatly appreciated.

Thanks!

Originally posted by @Corey Hassan :

Hey BP,

Question here on something that I have researched a bit in the past but unsure on whether this applies to what I read.  I have an extremely strong lead that has said they talked to the executive director of an assisted living/retirement community and they are interested in speaking with me about what I do and seeing if it may benefit some families in this location.

I have done a lot of research and I know that I have read often times this is NOT possible due to Medicaid.  I told my contact this and I was told that this is a private facility and financing for the patients in the facility is not done through Medicaid but rather done privately.  If this is true would this allow me to have an opportunity to pursue this?  Any help would be greatly appreciated.

Thanks!

Hi Corey,

Could you expound a bit on this medicaid issue?  If a person uses medicaid to finance living in a retirement community,  what does that stop you from doing?

Thanks, 

Erin

@Erin Elam  

I believe if someone is receiving financial assistants through Medicaid than an example would be is if I were to buy there home someway, than I could either get in some sort of trouble, or any money that may be made on the home would go to the state.  Again, definitely not an expert on this but this is just what I heard.

@Corey Hassan , I'm not an expert at the implications of assets in Medicare and Medicaid, but I work with folks in end of life situations fairly often and can share some general rules:

1. Medicare (the govt insurance you get at 65) does not have any bearing on ones estate/real estate. As it's not a means test program (everyone gets it) it operates much like your private health insurance does, basing its premiums on how much it pays out. As a partial result, it DOES NOT cover long term nursing home care, as those costs can be huge. It will cover short term rehab stays though, such as post surgery.

2. Medicaid (the federally funded state run insurance program for the poor) does have rules on what can be done with assets before and after enrollment. This program DOES cover long term nursing home care, and so can rack up some major bills on behalf of someone who is in a home for years with little or no income.

3. There is a specific rule that allows Medicaid to collect money from the patients estate after they pass to recover the costs of long term care. This can include proceeds from the sale of real estate if the person passing was the last resident. If there is a spouse, it can be deferred until they pass away and no longer reside there. I'm guessing this is what would cause a problem in you purchasing their property.

4. If a person is receiving Medicaid or SSI (different from Social Security retirement), there is a pretty low cap on the amount of liquid assets that can be retained ($2000 IIRC). If someone sold a house while in long term care, that money would mostly go to the govt anyway, reducing the incentive for someone to sell. The house is protected as a primary residence on being counted as an asset before sale.

Hope this helps!

Hey @Bradley Bogdan  

thanks a lot for the response.  I am still a little unsure of if this would be an opportunity or not.  Are you saying that although the person in the assisted living facility is not receiving financial assistance via Medicaid, the assets such as real estate sold off would go to the government anyway?

Very interesting question.  I am interested in the answer to this.

The first thing I would do to figure this out is get a real estate attorney and a medicare insurance agent together and have a chat. 

Originally posted by @Corey Hassan :

Hey @Bradley Bogdan 

thanks a lot for the response.  I am still a little unsure of if this would be an opportunity or not.  Are you saying that although the person in the assisted living facility is not receiving financial assistance via Medicaid, the assets such as real estate sold off would go to the government anyway?

 Not that I can see. It would be my impression that if the folks are paying either out of pocket, or using private insurance (either a very generous comprehensive plan or specifically a long term care add on or plan) I would think you would be in the clear. 

Where it would get messy that I could see is that often low income programs (like Medicaid, Section 8 and SSI) have guards that make it tough to "dump" assets in a certain amount of time before utilizing the program. So, if you were to buy someone's property below market value, that could leave them vulnerable in the future if they don't have adequate coverage or income and end up needing Medicaid or another low income program and then can't get in because they sold off assets. The thought being that you didn't want seniors dumping assets at bargain rates to friends and family to become eligible for Medicaid to cover their long term care or other big medical bills. 

While the things I've mentioned all seem to point to the seller needing to make sure a sale doesn't screw them in the long run, I'd definitely speak to a financial planner or a friend in hospital/long term care billing to make sure you're knowledgable enough not to accidentally put someone is a bad spot. It sounds like your director friend has part of the know how, perhaps he can point you to someone that has the rest. 

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