Quick Read
When a couple sold their Ohio home and banked the $310,000 proceeds, Florida Medicaid counted the full balance as a resource, not a protected asset.
Florida's spousal-impoverishment rules let the at-home spouse keep up to $162,660, leaving the couple with roughly $145,340 in excess countable assets.
Excess assets can be legally converted into exempt resources by purchasing a home, paying debts, or prepaying funeral arrangements instead of gifting to children.
Consider a common scenario elder law attorneys describe. A retired couple sells their mortgage-free Ohio home, banks the $310,000 in proceeds, and moves to a Florida rental. They're done with property taxes, roof repairs, and hurricane shutters. Three years later, the husband has a stroke and needs a nursing home.
They assume the money is safe because it came from their longtime residence. Florida Medicaid treats the proceeds as cash. It sees a bank balance of $310,000, and that balance is countable. When he applied three years later, any momentary protection for income designated for a replacement property had expired. Florida treated the remaining $310,000 as eligible cash.
A House and Its Proceeds Are Different Assets
Medicaid, the joint federal-state program that pays for most long-stay nursing home care, as opposed to Medicare, which only covers short-term skilled nursing after a hospital stay, treats a principal residence very differently from cash.
A home the applicant or spouse lives in is generally excluded from countable resources. An institutionalized applicant can sometimes preserve the exclusion under an intent-to-return rule. Once the house sells, that protection doesn't stick around with the proceeds forever.
Some states allow a short window to reinvest sale proceeds in a new principal residence. Three years is far beyond any ordinary replacement period. The entire balance sitting in checking, savings, or a brokerage account gets counted.
Many expect the five-year look-back to be in control here. It isn't.
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