Help Senior in debt, what to do?

[Ajax]

Hi everyone. I need some advice, my mom's 76 years old and has terminal lung diseases and she is $50,000 in credit card debt. She owns her own home with no notes against it. She is living soley off of social security, and can't manage to pay bills much less credit card debit. What's the best course of action, stop paying the cards or chapter 7? She is not on medicade yet since I'm paying here premiums, but I'm going in debt helping her.

[AngelinaCatHub]

Chapter 7 for sure. Don't let them sue her as a Judgment will take the house. With her conditions, get a power of attorney and you (possibly) can be at her 341 meeting. You can get a doctor's script to state she is too infirm to attend or can telco attend.

How long does she have? If it is imminent, with no judgment you are not responsible for her bills, but I would check with a lawyer. How long has she not paid the cards. Also you should get her on Medicaid so you are not the next bk. 'Hub

[Flamingo]

You need to do two things; get a consultation with an elder law attorney as to what to do to take care of your mother (and you will also need to get a power of attorney to act on her behalf). Do you have brothers and sisters? Call them immediately if you do and advise them of the situation. Get family help if you can. Secondly, get a consultation with a BK attorney to find out what to do as to your mother. I cannot stress how important the elder law attorney is right now to protect your mother and her assets and also the advice you will need to take proper care of your mother.

[HHM]

How much do you think the house is worth.

I am not sure she is a BK candidate based on age and equity in her house.

However, assuming she can exempt all equity in her home, then a chapter 7 is probably the quickest and cheapest solution.

[CindyLou]

What state is she in and how much is her house worth?

[AngelinaCat]

CindyLou, you got your status back...YEA!

After seeing 'Hub's post, I should add that Mom may not qualify for Medicaid if she owns her home. This happened with my aunt, who had Alzheimer's, and no insurance. She needed to be put into a nursing home, as the family had exhausted their means of caring for her, and her case had progressed so that in-home care was no longer possible. She had no way to pay for a nursing home, nor did her son and daughter. The only route was Medicaid. Her son and daughter had to get everything out of her name including her home and car, a 1974 Vega. This was 1982 or 83, and just before some laws changed making a 6 month back-look necessary. I am certain that the laws have change even more between then and now.

[WhatMoney]

Do you want to keep the house after your mother's death? You have several options, but you reallly need the advice of an elder law attorney.

The home is exempt from Medicaid qualification as long as it remains a "home". See this URL for more detail:

http://aspe.hhs.gov/daltcp/Reports/hometreat.htm

Medicaid will want the equity in the home to pay for her cost of care on Medicaid, and will have the first lein after her death. It may be too late to protect this asset. There is a 36 month lookback period now for asset transfer or gifts, and 5 years for trusts. Again legal advice essential.

Once on medicaid, judgments from creditors are meaningless. Your mother would be judgment proof, and the State is first in line for the home. BK7 would take care of her unsecured debts, but unless your state has a homestead exemption, the home equity beyond the state exemption is fair game.

Reverse mortgage, pay off the debts, and keep the house until forced to move is another option, if you don't want Medicaid - but that only assumes there is enough left from the reverse mortgage to cover all her Medicare and long term care bills for the rest of her life. You should not be paying anything - it's not your responsibility.

[AngelinaCat]

WhatMoney has excellent suggestions. When my cousins were dealing with their mother, my aunt, and I was dealing with MY mother, aunt's older sister--who also went the Alzheimer's way--but progressed 6 months behind aunt's case, the field of Elder Law was unheard of. My cousins and I felt like we were floundering in the unknown. Our general practice type attorney helped us greatly, though.

[Flamingo]

Do you want to keep the house after your mother's death? You have several options, but you reallly need the advice of an elder law attorney.

The home is exempt from Medicaid qualification as long as it remains a "home". See this URL for more detail:

http://aspe.hhs.gov/daltcp/Reports/hometreat.htm

Medicaid will want the equity in the home to pay for her cost of care on Medicaid, and will have the first lein after her death. It may be too late to protect this asset. There is a 36 month lookback period now for asset transfer or gifts, and 5 years for trusts. Again legal advice essential.

Once on medicaid, judgments from creditors are meaningless. Your mother would be judgment proof, and the State is first in line for the home. BK7 would take care of her unsecured debts, but unless your state has a homestead exemption, the home equity beyond the state exemption is fair game.

Reverse mortgage, pay off the debts, and keep the house until forced to move is another option, if you don't want Medicaid - but that only assumes there is enough left from the reverse mortgage to cover all her Medicare and long term care bills for the rest of her life. You should not be paying anything - it's not your responsibility.

The mother will not be considered for Medicaid until her assets are spent down to approximately $2,000. That would include selling her house for her medical care. Since the house is in the mother's name from what I can understand here, there is no protection as to the look back period. That is why I suggested in my initial response on here for the OP to contact an elder care attorney immediately. The consultation would be well worth the $150 or so it may cost but the advice is priceless to protect assets and get advice on what needs to be done. Also a needed POA can be obtained at that time. The daughter/family cannot act without that on any documents in the mother's name. Been through all this. Highly recommend anywone with an aging parent to consult with an elder care attorney and also recommend consultations as to your own estate as to your own assets to protect them for your own children with a lawyer experienced in wills and estates. Or else the house you or your parents worked for all your life or their lives would have to be sold to cover medical care. The lookback period for Medicaid is now five years; you can bet within several years it will get pushed to a longer term as the government will create more tools to get that money and house to keep it from heirs. Rich people have that all taken care of via all sorts of trusts. The middle class has no idea.

[morallyBR2]

Actually there is grace period with medicaid. In Texas at least. I just went through this before my grandmother passed away. She was in and out of the hospital the last six months she was living and medicare/caid paid all the bills. As long as there is no more than 120k equity you should be fine. I actually am filing bankruptcy chapter 7 and I now own the home free and clear that my grandmother lived in. But if medicaid exceeds a certain dollar amount they can sieze the property. What saved me was that my grandmother passed away prior to my grandfather so after her passing medicare/caid dropped any claims against the property because my grandfather was still living. Six months later my grandfather passed away but they had no rights of claim at that time. I immediately moved in and claimed homestead and sent my other house into foreclosure as a "rental property" It all works out in the end if you keep up on your research. Just keep your head up high and don't be afraid to compromise some morals here and there. My grandparents were allowed the same $2000 but that was excluding property and a vehicle. They just could not have more than $2000 in the bank. All my grandfather did was take out their money and "gift" it to me to pay for my school. I also was put on as a authorized signer on his account in case something did happen to him I could write the money out asap. I was certainly not expecting his death only 6 months later so needless to say grandma and grandpa have the pimpest headstone in the cemetery. I would have been damned before I allowed any sorry ass government agency to get their money for anything. I personally hold medicare/caid and their shitty policies responsible for my grandmothers death. Hince the user name "morally bankrupt too" Genarally mad at the world??? Hell yes I am!! And medicare and my credit card companies are going to get the majority of my aggrivation. There are things you can legally do with her money to avoid being labeled "fraud" IE, a twenty thousand dollar headstone. Had I bought; chicken, *****s, and beer, yeah medicare could have had a claim against my spending but you can not argue a headstone. Sucks to be them! In a dog eat dog world, you are going to eat or be eaten. A good friend of mine says that there are two types of people, people that steal and people that get stole from. Its you against the government and only one can win!! Just be proactive and get mad!! Now get ya some bubba!! Good luck!!

[WhatMoney]

The mother will not be considered for Medicaid until her assets are spent down to approximately $2,000. That would include selling her house for her medical care.

Only if she no longer lives in the home:

The home is an excluded resource in determining Medicaid eligibility, regardless of its value. Medicaid policies protect the home for the use of recipients and certain close relatives.

http://aspe.hhs.gov/daltcp/Reports/hometreat.htm

.

[Flamingo]

I immediately moved in and claimed homestead and sent my other house into foreclosure as a "rental property" It all works out in the end if you keep up on your research.

My mother lived by herself in her house in her name. She became disabled and was unable to be rehabilitated and we had to put her in a 24 hour nursing care facility due to doctor's orders. To pay for the nursing facility, we had to pay out of pocket after Mediare covered her for three months trying to rehabilite her. Since the house was not in our name, our father deceased and no child living there full time for two years prior, Medicaid took all assets and her house and social security check, leaving her $2,000 and $40 per month for clothing allowance. That was the monthly amount of the check she would receive. There are certain rules that do continue to change (i.e., the recent change in 2005 from the 3 year look back to the 5 year lookback on asset/property changes). In the OP's situation, it appears she does not have that worry about and needs help in the short-term unless her mother has to go into a long term care facility due her illness. Since she has assets that appear to be in her name only, the OP has some quick stepping to do to get the property legal advice. If I were her, I'd be on the phone tomorrow with the nearest elder care lawyer I could find.

[WhatMoney]

Flamingo, thanks for correcting the lookback period to 5 years for all assets. It was 3 years when I went through all this with my parents in 2003.

My parents private-paid their long term care for five years (~$400,000), and finally spent down to $2000 and switched to Medicaid when my Dad turned 91 yrs old. He died 4 months later.

Of course the assisted living facility they lived at for five years did not accept Medicaid payments (lower than private pay), so I was forced to search for a new home for them - and as expected few of the decent for-profit assisted living facilities had any openings for Medicaid. I spent months feeling like a third class citizen trying to find a place for my elderly disabled parents to live once they were forced to switch to Medicaid, and after spending their life savings on these same assisted living corporations that now refused them because they would could get 20% more rent from private payers. The private care system in this country truly sucks.

Had I bought; chicken, *****s, and beer,

Having trouble filling in the blanks - what goes with chicken and beer? lol

[Flamingo]

Of course the assisted living facility they lived at for five years did not accept Medicaid payments (lower than private pay), so I was forced to search for a new home for them - and as expected few of the decent for-profit assisted living facilities had any openings for Medicaid. I spent months feeling like a third class citizen trying to find a place for my elderly disabled parents to live once they were forced to switch to Medicaid, and after spending their life savings on these same assisted living corporations that now refused them because they would could get 20% more rent from private payers. The private care system in this country truly sucks.

Having trouble filling in the blanks - what goes with chicken and beer? lol

In our state, all assisted living and/or nursing homes/facilities have to have a certain number of Medicaid beds. Unfortunately, they could be all full when one is needed. Private pay are always given priority but when you can afford to pay $6,500 per month and more for a love one's care, or if they have long term insurance, you can see why they prefer to have those folks at a facility over the Medicaid patients for which they receive less and require a ton of paperwork. We were hoping my mother could have been rehabilitated where she could stay in her home or even come live with one of us. She could not do either as she required certain care that was 24 hours and we had to, under doctor's orders, put her in a proper 24 hour care nursing facility due to medical reasons. So we got hit hard with reality, as lots of folks do, because we had no clue as to Medicaid, transferring property in the years prior to our names, etc. Usually no one knows or cares about that until something happens to an elderly parent or relative and it all comes to light. We felt so bad selling my mother's home because she and my dad worked hard all their lives to get/keep that house and there were things my sister and I could have done in the years prior to the time she became ill to hold onto that house. The rich can afford lawyers and consultants to take care of them as to all that; those of us in the middle class of society don't have that luxury and find out the hard way.

[morallyBR2]

Flamingo, thanks for correcting the lookback period to 5 years for all assets. It was 3 years when I went through all this with my parents in 2003.

My parents private-paid their long term care for five years (~$400,000), and finally spent down to $2000 and switched to Medicaid when my Dad turned 91 yrs old. He died 4 months later.

Of course the assisted living facility they lived at for five years did not accept Medicaid payments (lower than private pay), so I was forced to search for a new home for them - and as expected few of the decent for-profit assisted living facilities had any openings for Medicaid. I spent months feeling like a third class citizen trying to find a place for my elderly disabled parents to live once they were forced to switch to Medicaid, and after spending their life savings on these same assisted living corporations that now refused them because they would could get 20% more rent from private payers. The private care system in this country truly sucks.

Having trouble filling in the blanks - what goes with chicken and beer? lol

Lol, actually i put a deragatory term for prostitutes. I just read that out loud and realized it could be interpreted as a racial remark which it wasn't meant to be. Sorry for the rant guys, when ever I think back to how sorry medicare/caid is it just pisses me off.