Expert: Regan Shinski - 2/17/2010

Question
My father recently suffered a stroke. He had no insurance, and racked up a huge hospital bill. He must be supervised (Does not need nursing home care however), and the only ones to take care of him are my girlfriend and I. His condo is way too small for the 3 of us, and we cannot maintain the payments on it while we wait and see if he will recover enough to live on his own again. What I'm not sure of is the best way to handle his property. He should make a decent profit off of it if he were to sell it, and then we could put that down on a place big enough for all 3 of us. I'm not sure if the hospital would be able to cease any profits from the sale or not. I would like to know the best route possible for me to protect his assets if they were in fact intitled to any profit from sale. I understand how medicaid works (If you need assisted nursing home care, they can with-hold payments based upon a formula which includes the sale of your primary residence), which he will qualify for, and SSDI. I just want to make sure that before I make a move, I know that his assets are protected. Thank you for your time and reviewing my question.

Answer
Hello Boyd:

I'm sorry to hear this news and bless you for caring for your father!

A lot of this depends on timing.  In general, the hospital is not going to be able to take anything at the time of the sale unless they have a judgement in place.  I guessing that has not happened yet.  I would give strong consideration to selling the property IMMEDIATELY, possibly even at reduced price before judgements and other anchors of collection are in place.

This is a VERY complicated situation, so I must limit my answer to a certain degree simply because I don't know the full details and timing of your case.  However, I really think you should also consult an estate attorney.  There are other options such as setting up a trust or signing the property over to a relative to protect his assets.  A trust is a very common one that I think you should look into to see if it fits your situation.  There are also tax implications that depend greatly on individual circumstances that I cannot account for in this forum.

Good luck - I think you have options to make it work.

Regan