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Question:

My partner and I are in our 70’s and not married but all of our assets are in both our names. How will this affect us as far as our home if one was to have to go into a nursing home? Would the one still living in the house have to sell it and give profits to the nursing home?

Response:

No, your home should be fine, as long as you both want to stay in it. With certain limits (up to $955,000 in home equity), you can keep your home and receive Medicaid coverage of your nursing home care. However, there are some potential issues.

First, if the nursing home partner passes away first, the state may have a claim for reimbursement against the home. Some states only go after probate property and some seek recovery against both probate and non-probate property. If the home is in joint names, it will pass to the survivor without going through probate, which would mean it’s protected in some states, but not in others. If you were married, this could be avoided by putting the home in the name of the non-nursing home spouse because there’s no penalty for transfers between spouses, but that exception does not apply if you’re not married.

Second, if the non-nursing home partner dies first and the home is joint names, it will pass entirely to the nursing home partner. Then it may have to be sold if he or she can’t manage it. At that point, they will have to go off of Medicaid and pay privately for their care until the funds are exhausted. If the house is retained, it will be subject to an estate recovery claim upon the death of the nursing home partner.

Third, while the home is not at risk during the life of the nursing home partner, keeping it in both names could prevent the healthy partner from selling the property and moving elsewhere if that’s what he or she prefers. Upon the sale, the nursing home partner’s share of the proceeds would not be protected and would have to be spent down on his or her care, leaving the other partner with only half the funds available to purchase a new property or pay rent.

So, the simple answer to your question is “no,” but given these other issues, you may want to consider putting your home in trust so it can continue to benefit both of you. In your case, since you’re not married, there are benefits to each of you creating a separate trust for your half of the property. I’d recommend consulting with a local elder law attorney. You can find one here: www.elderlawanswers.com.

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