few years ago I wrote an article about the need to keep at least five years’ worth
of financial records, in case you or your spouse need to go into a nursing
home. Since that time, I have had more than a few clients who have run into
problems retrieving these records from their banks or other financial
institutions when they make a Medicaid application. This refresher hopefully
will drive home the importance of what I am talking about.
one knows whether they or their spouse will need nursing home care. Considering
that the cost of such care is expensive – approximately $500 per day locally,
$182,500 per year – virtually everyone will try to do what they can to become
eligible for Medicaid, which will pay most or all of that cost if you become
application is made for Medicaid coverage for care in a nursing home, five years’
of financial records, including a spouse’s records, must be provided to the Department
of Social Services (“DSS”). If something is missing – and it almost always is –
DSS sends a letter stating what is needed, and allows ten days for it to be
missing documentation can not be provided within ten days. A request is made
for more time and, if the applicant shows that all reasonable efforts are being
made to comply, DSS likely will allow another ten days. Beyond that, additional
time is not likely. What is then likely is a letter from DSS denying Medicaid
coverage for failure to provide the requested documentation.
there are ways to fight the denial, that process gets more expensive. Coverage
might also be delayed, meaning that months of the nursing home bill might have
to be paid privately.
A woman who is applying for nursing home Medicaid is a
husband died two years before.
After he died, she discarded financial records of all accounts he owned by
himself, thinking they would not be needed. They are needed. She is required to
use all reasonable efforts to obtain those records, potentially including
applying to the Surrogate’s Court to become the legal representative of his
estate, even though there otherwise would have been no reason to do so. 2.
A man who is applying for nursing home Medicaid
transferred his IRA
account three years ago from one
administrator to another. Although he has his records from the prior
administrator up until the time he changed to the second, he never actually
closed out the account. The last statement he has from the prior administrator
shows a two cents balance after the transfer. That account never was closed. He
must close that account and obtain all records from that account until closing. 3.
A woman who is applying for nursing home Medicaid
thought she provided
all records needed, and was
surprised when we asked her where a $20,000 deposit into her account four years
before came from. At first, she had no idea. After she contacted the bank into
which the money was deposited, and they did some research, she learned that the
money was from a certificate of deposit that she had at another bank. Of
course, she had to obtain those records. 4.
A man who is applying for nursing home Medicaid sold
his house three years
before. He figured that by now he
no longer needed those records. Wrong. He needs them. He needs to show the deed
transferring the property and proof of how much money he received for the sale.
He also needs to show where that money went.
legible records of all accounts and property owned during the last five years,
in neat chronological order. This includes accounts that have been closed. No
staples. Keep records of transfers. If you received an inheritance, or a gift,
or sold your car or boat, keep copies of those records, and the checks before
you deposit them, or at least a written record proving the source of deposits. If
your bank does not include copies of your canceled checks with your statements,
I suggest changing banks to one that does.
often, we see deposits into accounts and no one remembers where they came from.
If the Medicaid application is being made by someone who had no involvement with
the record-keeping, and has no authority to deal with the bank or other
financial institution, the result could be a denial. That is poor planning. By
the way, Florida banks are notorious for losing records!
sure a trusted person or two at least has authority to obtain copies of
financial records. A better recommendation is that your trusted person be
authorized to sign on accounts, and that you sign a comprehensive Power of
Attorney authorizing that person to act on your behalf.
good record-keeping is required for income tax purposes anyway, the additional
organization discussed here should not be a great burden. If the time comes for
a Medicaid application, your loved ones will thank you for the concern you
showed by making it easy for them to figure things out.
2019 Joseph A. Bollhofer, Esq.
Editor’s Note:Joseph A. Bollhofer, Esq., practices law in the areas of elder law,
Medicaid, estate and business planning and administration, and real estate. He
is a member of the Elder Law, Real Property, and Surrogate’s Court Committees
of the Suffolk County Bar Association and of the Elder Law and Real Property
Law Sections of the New York State Bar Association. He has been serving area
residents since 1985 and is admitted to practice law in New
York and New Jersey.
His office is located at 291 Lake Ave., St. James, NY.
(584-0100). For reprints of this article and others concerning Medicaid, Elder
Law and Estate Planning, send a request to email@example.com or visit