For most people receiving inheritance is a welcomed gift. It includes treasured memories and possibly the financial resources to complete school, start a business, or have financial security. But for those receiving certain types of government benefits, receiving an inheritance can be highly detrimental, causing them to lose their benefits. And possibly their only access to medical care. It is important to plan in these circumstances to avoid such disastrous results.
One of the times that an inheritance can cause problems is when the person receiving the inheritance is disabled and is receiving Supplement Security Income (“SSI”). SSI is a Federal program that provides monthly cash to those who cannot work due to a disability. Receiving SSI also entitles an individual to receive Medicaid, which covers a wide range of medical care, including at home care. To qualify to receive SSI, the applicant’s assets and income must be below a specified level. Receiving an inheritance can push the SSI recipient above that level, and cause a loss of SSI and Medicaid benefits. The services of an experienced Georgia elder law attorney should be used to form a trust based estate plan such that the inheritance goes into a special needs trust for the benefit of the person receiving SSI, and does not cause an interruption in benefits.
The second scenario in which an inheritance can have negative consequences is when the person receiving the inheritance is on nursing home Medicaid. Nursing home Medicaid is a Federal program administered by the Georgia Department of Community Health to pay for nursing homes for people who have a medical need for nursing home care. Along with showing a medical need for nursing home care, An applicant must have income and assets under a specified level. Receiving an unanticipated inheritance can cause the individual on nursing home Medicaid to lose benefits. As there are often restrictions on transfers of assets by someone who receives nursing home Medicaid, the Medicaid recipient may be forced to pay as much as 40% of the inheritance to the nursing home. Again, with proper trust planning by an experienced elder law attorney, this result can be avoided.