2018 Elder Law and Probate Court
In the firm’s Elder law practice we often use the authority of Probate Court to help clients. This can happen when someone has qualified for Medicaid or needs to qualify for Medicaid and there is a need for asset transfers. The Probate Court can be Petitioned when a disabled individual lacks an estate plan that allows for asset transfers (asset protection) upon their disability.
A typical situation is when one spouse needs to be in a nursing home and the other spouse is living at home in the family home which is owned by both the husband and wife. Many times an estate plan will not allow the home to be transferred to the community spouse in this situation because the estate plan did not contemplate disability planning. Usually it is beneficial to have the family home transferred to the spouse who is living at home.
Transferring the home to the spouse who lives at home will give them more options such as the ability to sell the home and downsize or borrow money with a mortgage and fix up the existing home. Transferring the home to the spouse living at home will also protect the home by allowing that spouse to update their estate plan so that Medicaid Probate Estate Recovery is avoided and the home can ultimately benefit the couple’s children.
Another scenario when Probate Court involvement can benefit a client is when there is a community spouse who needs additional income to live on. When one spouse resides in a nursing home and receives Medicaid and has a community spouse there are income rules. These rules, using a complex formula, determine how much of the nursing home spouse’s income can be paid to their community spouse each month.
Many times the standard formula will not provide enough money for the community spouse to live on because of their needs. This could be due to a number of things like outstanding credit card debts, the need for home repairs or medical needs of the community spouse.
In these situations the firm can Petition the Probate Court to try and increase the amount of monthly income that can be paid from the nursing home spouse to the community spouse. This will enable the community spouse to better meet their financial needs and have peace of mind.
On May 22, 2018 a Michigan Appeals Court published a lengthy decision which now requires a Probate Court to consider a nursing home spouse’s needs and patient pay obligations in connection with any asset transfers or increases to the community spouse income allowance. This case will make it harder, but by no means impossible, for a community spouse to have assets transferred to them or the monthly community spouse income allowance increased.
Please contact us for assistance with your long term care legal issues. The first step towards learning about your rights and options is to have a consultation with an experienced Elder law attorney.