Sharon and her husband moved into her father's home more than seven years ago. It seemed like the reasonable thing to do, as Sharon's father didn't have the funds to pay for the help he needed, but he had the space. Sharon and her husband wanted to move from their tiny apartment, but they couldn't afford a house. Now Sharon's father has had to move to a nursing home and apply for Medicaid to help with the cost. Sharon is frightened that they will lose their only home to Medicaid.

It is true that most Medicaid programs have become more aggressive in trying to collect what they have spent on a nursing home patient's care, so that they can in turn "re-use" that money to help other Medicaid recipients. Because a home is often the most valuable asset, or even the only real asset of someone receiving Medicaid help, the State is empowered to place a lien on the property to reimburse the Medicaid program. When the nursing home patient dies and the home is sold, the State is then reimbursed the cost of the care Medicaid covered. Any money remaining after Medicaid has been reimbursed is distributed to survivors by the terms of the owner's Last Will.

There are some exceptions to the rule that Medicaid gets first crack at a home when someone has received benefits in a nursing home.

First: If a spouse continues to live in the home, then Medicaid will place no liens, and the home can continue to be occupied by the spouse with no worries about having to reimburse Medicaid. Whether the title to the home should be put solely in the name of the spouse-at-home should be discussed with an attorney as individual situations may differ and state laws certainly do differ.

Second: Spouses are not the only ones who are protected from losing their home. An adult child who has lived with and provided care to someone now receiving Medicaid in a nursing home may also be protected from losing what is their home, too.

If an adult child lived with a parent for at least two years, and if the care that child provided helped to keep the parent out of a nursing home for at least two years, then the adult child should be able to continue living in the home without worrying about a Medicaid claim for reimbursement. The parent is usually able to transfer ownership of the home to the child without any Medicaid penalty at all.

There may be tax and other implications, however, so it is very important to consult an attorney before you transfer title, or encourage anyone else to transfer title, to any property.

The family caregiver may be required to provide evidence to Medicaid that the care provided really did keep the parent from needing a nursing home.

If you have lived with and cared for someone now in a nursing home, you will certainly be required to prove what kind of care you provided and for how long. Every state has their own requirements for how you should do this. Some will require statements from your parent's doctor or other professionals. You will also probably have to provide proof of your address for at least the two years preceeding your parent's entry into the nursing home.

Any good elder law attorney or your State Medicaid office can tell you what documentation you will need. You can find your local Medicaid office by using the Benefits.gov website and searching for your state, or you can call the Eldercare Locator at (800) 677-1116 for the address and phone number of your nearest Medicaid office.

Never take legal advice on something that is this important to you from a friend, a neighbor, a clergyman, a social worker, or an attorney who does not practice elder law.