WHY? My Mom is getting dementia, and Medicaid eligibility requires less than $2k of assets in our state. My plan is to get all the money in my name, pay on her behalf as private pay (as Medicaid has a 5 year lookback period on gifts) and once the 5 year window has expired, she would be eligible for Medicaid.
I don't know if this plan is ethical. If I have to ask it probably isn't. Thoughts?
If you're doing this to exploit government loopholes and screw the rest of us taxpayers then yeah, it's probably not ethical.
But look at it from another perspective: what would your mother want you to do? That's ethical. She probably feels that it's the only way she'll ever get any benefit from the rest of her FICA.
I'm my father's conservator. I do not expect his Alzheimer's to outlive his assets. I also don't need any of his money.
However I know that my brother would benefit from getting some of Dad's inheritance now rather than later... especially if we ohana Nords have the same genes as our father and his father. I don't know the family financial facts any better than I know my ancestor's Alzheimer's genes, but I suspect that Dad was making sure that my brother got some financial assistance during the years before Alzheimer's pushed Dad's cognition off the cliff. Dad even gifted me a few years in the 1990s (before my spouse and I reached FI) so I'm pretty confident that he'd agree to gifting now rather than bequeathing later.
So last year I told the probate court that Dad was going to start gifting us sons each year. They noted that expenses exceeded income yet assets appeared to be sufficient to handle the drain. They also pointed out that Medicaid would invoke the five-year lookback on gifting. Then they approved my conservator's plan-- so now I have official government approval to screw the rest of us taxpayers.
My spouse and I decided that it's best for family harmony for Dad to gift my brother and me in equal amounts (as documented on my annual conservator's report). I'm investing my "Dad gifts" in a separate account (in only my name) with my brother as beneficiary. When Dad's assets get to the Medicaid stage then I'll start gifting him back the money that he gifted me. That should get him through the five-year Medicaid lookback. My brother is free to contribute to this plan if he wants, but I'd advise him that it's not necessary.
This planning is probably overly conservative, but I fear that I need a long-term plan. I wish there was a better way to predict Alzheimer's longevity. My grandfather was in a full-care facility for 14 years, and his spouse had probably been covering up his cognitive deficiencies for at least five years before her death. He finally passed at nearly age 98 from pneumonia.