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  1. #1
    Join Date
    Jan 2009

    Default Effect of Gifts on Social Security Benefits


    I have 3 questions I need answered, and this was the best choice I could find regarding which board to post to. Sorry, if its the incorrect one.

    Some background information first so people understand the questions. My grandfather passed away in Sept, 2008. He left an irrevocable trust, which is still being processed. He left my mother his house, which is upside down on equity. He also left an Annuity, which was split in half between my mother and uncle. They each got 122k, which was rolled into a new seperate account from each other so they could each control it. The account for my mother does not show her as direct holder, rather it states "Mother name beneficiary of Death Benefits of Grandfather". Mother and Grandfather names are of course real, but changed for this board. My mother however is on SSI, SSI Supplemental, Medicare, and Medi-Cal (California). She has the contract on the annuity, and is required to take required minimum distributions either monthly, semi annually, or annually. Now comes the questions regarding this situation.

    1. My mother wants the house moved to my name, can she legally do this without causing her to lose SSI, SSI Supplemental, Medicare, and Medi-Cal (California).

    2. My mother wants the money given to me, she has no need for it. In fact, she is moving in with us because her memory is fading, and her health is deterioting. She will NOT go to a nursing home, and we will not force her. Can she do this without losing her SSI, SSI Supplemental, Medicare, and Medi-Cal (California).

    3. If the above cannot be done, can she do something else to prevent Medi-cal from taking it all when she goes?

    This is such a weird situation I cannot find any information on it really. I keep seeing look back periods regarding nursing homes and such, however she has been a receipant of medi-cal for 7 years at least. The wording is just plain confusing me overall.


    Concerned Son

  2. #2
    Join Date
    Sep 2005
    Behind a Desk

    Default Re: Effect of Gifts on Social Security Benefits

    Your mother needs to discuss her situation with a lawyer who is familiar with Medicaid regulations and special needs planning.

  3. #3
    Join Date
    Jan 2009

    Default This is a sore subject with me

    Social Security benefits are not a welfare program. Supplemental Security Income is a welfare program. Medicare is not a welfare health insurance program. Medi-Cal is a welfare health insurance program.

    Explain to me why your mother has no need for an asset worth $122,000?? Why she needs to remain on 2 welfare programs instead? Why she wants the taxpayers of California (who are running out of money) to pay her the state supplement part of her SSI benefit and the state funded part of her Medi-Cal when both of those programs are designed to be for people who don't have access to $122,000? California is issuing IOU's for tax refunds this month.

    She may be used to being on SSI and Medi-Cal and afraid of the change, but surely $122,000 or the mandatory distributions can pay for medical care and food and shelter for awhile. Medicare would still cover the bulk of her medical bills since Medicare is not a welfare program. She would be like other disabled or elderly middle income people and have to pay out of her own pocket for co-pays, deductibles, premiums for Medicare supplement insurance programs.

    Medi-Cal did not force her to sell her home when they started paying her medical bills seven years ago, did they? She was allowed to stay in her home until she was no longer able AND had medical coverage that she didn't have to pay for. What is so bad about paying it back once she doesn't need the home anymore? Is it just that she wants YOU to have the money instead of paying back the state who took care of her? If she was on Medicare also, the bulk of the medical bills were covered first by Medicare, so the Medi-Cal payback may or may not be that large.

    There are non-payment and non-coverage penalties and exceptions in both SSI regulations and Medi-Cal regulations for people who give away money in order to stay on SSI and/or Medi-Cal. The rules are complex and subject to interpretation so there is no cut and dried answer to give you here.

    I agree that she needs a good estate planning attorney who specializes in Medi-Cal and special needs trusts. But before giving away her money, even legally, you should consider the benefits of NOT being on public assistance. No rules that have to be followed in regards to what you do with the money or how much you can have. No one telling you what you can and cannot do with your assets. No worries about Big Brother coming in and telling you that you did something wrong. With her health failing, why not use the money that belongs to her to make HER life as comfortable as possible with as many perks as she can afford? Why not live well, rather than as a welfare recipient, for as long as she can afford it? It is a different kind of lifestyle.

    She is likely ineligible for SSI benefits beginning with the month the money was inherited, which sounds like some time in the past. She already owes that money back to SSI. Not sure what Medi-Cal will do.

    You need an attorney. Don't rely on message boards. Please consider all of the ramifications of this decision. You must be a blessing to her since you are taking her in to live with you. Thank you for that. Sorry if any of this post may offend you, but, like I said, it is a sore subject with me.

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