Featured Stories

Other Pamplin Media Group sites

Elderly in long-term care spend down assets and become eligible for Medicaid

When elderly people move out of their houses and into long-term care facilities, they probably don't need their furniture or other household property.

"Usually it's just a room they're living in, and their possessions aren't as important as they once were," said Cindy Van Loo of Van Loo Fiduciary Services.

But if their care is — or eventually will be — paid by Medicaid, depending on their value, their possessions might be important to the state, since Oregon foots the bill for 40 percent of Medicaid costs out of its general fund. The other 60 percent comes from the federal government.by: PHOTO: MERRY MACKINNON - Some seniors sell their houses and their possessions through estate sales to pay for long-term care. After theyve spent down their assets, and if they have low incomes, they may be eligible for Medicaid. Estate sales in the Portland area bring on average between $8,000 to $10,000.

As a conservator for her clients in long-term care, Van Loo manages their assets to pay the facilities. "When a person goes to a care facility, most times the assets are used to pay for their care," Van Loo said.

If people are alone, their house, if they own one, is sold to pay for their care.

In some cases a yard sale is held, and those proceeds also will be used to pay for long-term care.

Only after the assets are spent down does Medicaid step in, because Medicaid won't pay for long-term care unless the person meets limited-assets and low-income criteria. Medicaid recipients aren't allowed more than $2,000 in countable resources. And if those in long-term care have income — for instance, $600 a month in Social Security — that money goes toward their care, with the state picking up the rest of the tab.

But after a Medicaid recipient in long-term care dies, the state may try to recover some of the costs by making a claim on the estate. Since Medicaid also pays for in-home care, some recipients still own houses when they die.

"When a person passes away, the person handling the estate has a duty to notify us, and we determine if we have a claim," said Policy Analyst Rick Mills with the Oregon Department of Human Services.

And most of the $18 million per year that Oregon recovers from Medicaid estates consists of claims on houses.

But after the person dies, the personal possessions in the house aren't necessarily of great concern to the state.

“Most personal effects have little monetary value, but may have great sentimental value to family and friends, so we generally are not overly concerned about trying to assert a claim against those," Mills said. "However, from time to time, we discover the individual owned some item that has substantial value which can be sold to pay all or a portion of our claim.”