You cannot buy a house while on Medicaid because Medicaid is a program by the US government that covers the health care cost of those with low income. You may lose your Medicaid program if you buy a house while on Medicaid.
Medicare is for the elderly while Medicaid is for anyone that has a low income either an American citizen or a qualified non-citizen.
If you are thinking of living in the US and you are thinking about spending money on health services, don’t bother yourself, you can apply for Medicaid.
When you are under Medicaid, you get to save some of your money that could have been spent on health services. If you have enough money saved, you might be thinking of buying a house if you don’t have one yet.
The question would be: Can you buy a house while on Medicaid? You might also be wondering if you can get a house while on Medicaid. What made you have Medicaid is that you have a low income.
Well, when applying for Medicaid, your financial documents will be reviewed. If you have more than#2000 in your account, you will be told to spend it down. Certain assets would be exempted: house, car, and jewelry. Based on the amount you need to have in your account, you can’t be expected to buy a house when on Medicaid.
What is Medicaid?
In the US, Medicaid is a program owned by the federal and state government that covers the healthcare costs of people with low income. These people can be of any age.
A household can qualify for Medicaid if they meet the Federal Poverty Level (FPL). FPL is determined by the Department of Health and Human Services.
However, the eligibility status differs from state to state. Medicaid is different from Medicare although they are both funded by the Federal government.
Also, there are benefits to enjoy under Medicaid that you can’t get under Medicare. Some of those benefits are: nursing homes care and personal care services.
Who is Eligible for Medicaid?
Eligibility status varies by age, financial status, family size, health, and citizenship status, and it depends on the state you are applying to. The state decides eligibility status. Children, moms, and babies, people with health issues can be eligible.
The percentage of the federal poverty level (FPL) determines the income requirements. In most states in 2021, a family of three with an annual income of $21,960 is still eligible for Medicaid except in Alaska and Hawaii which is a little higher.
What is Covered under Medicaid?
- When you are covered by Medicaid, you get to pick your Primary care provider (PCP). This is the health professional that will be taking care of you and your family.
- Medicaid plan offers prevention services as a regular check-up with your PCP.
- It also covers medications like medical tests that are recommended for you. These services will cost you nothing or little money.
- The Medicaid plan can also cover services like Dental care, extra support during pregnancy, eye care, immunization for children.
Can You Buy a House while on Medicaid?
In many states, assets like houses, cars, jewelry aren’t required when you want to qualify for Medicaid. They are only concerned about you earning low incomes and the amount in your bank account. You have to spend down the excess money so that you can still be covered by Medicaid.
You can have a house before you enroll for Medicaid. But while on Medicaid, you can’t buy a house except it’s your primary residence or you sold your house and you want to use the money to get another house.
If you want to buy another house besides your primary residence, you’ll be questioned about where you got the down payment. Since you claim you earn a low income, how come you were able to buy a house?
You can also buy a house from your income if it’s not too much. There are some governmental mortgage assistant programs that you can apply for that would help you to buy houses.
Reasons Not to Buy a House while You are on Medicaid
The main reason why you shouldn’t buy a house while on Medicaid is to avoid losing your Medicaid program. You buying a house means you have more than is required in your account. If you are earning more than required then you will lose your Medicaid plan.
Can You Own a House and be on Medicaid?
Yes, you can own a house and be on Medicaid as long as you already own the house before applying for Medicaid.
Being on Medicaid only shows that you are earning a low income. And you must only have up to $2000 in your bank account.
However, some assets are exempted when you apply for Medicaid so you can have a house before you apply for Medicaid. Your home is safe when you are on Medicaid. You can even have an expensive house.
Once your income has been tracked five years backward and your income is low, it doesn’t matter the kind of house you have, you can be on Medicaid.
When to Buy a House when on Medicaid?
You can buy a house anytime you want especially if you are on SSI benefits. What matters most is that you have a low income. But you can’t pay in cash because it will only reveal you lied about your income. Nobody will believe that the huge amount dropping in your account is not yours.
If the house is going to be your primary residence, you can still buy a house anytime but you won’t pay with cash from your account.
When Not to Buy a House when on Medicaid?
Don’t buy a house while on Medicaid when you are still earning a low income. This will make you lose your Medicaid program.
Moreover, not buying a house when on Medicaid is your choice even if you need it as a primary residence. You can’t buy a house with cash when you are on Medicaid.
For example, the fact that your State allows the use of shipping containers as home, you decide to buy one considering how cheap shipping container homes are, forgetting that you are still on Medicaid and the major reason why you opt for Medicaid in the first place. Be conscious of your actions to avoid losing the Medicaid program.
Will I Lose my Medicaid if I Buy a House?
Yes, you will lose your Medicaid if you buy a house while on Medicaid. However, if your eligibility status allows you to save more money, you can opt to buy a house, thus not lose your Medicaid.
The only issue is if you pay your down payment with cash then you will lose your Medicaid. You will also lose your Medicaid when you buy a house that’s not your primary residence because by buying that house, your countable assets will be more than what is stated by your state.
How Do I Stop Medicaid from Taking my House?
Having a law expert on Medicaid is essential. This is because Medicaid can take your house. If you apply for Medicaid, there’s a part where you will be told that Medicaid will ask for its money back.
But many times people are too unsettling or there is a lot of paperwork to sign that they don’t get to see that aspect. And when the Medicaid recipient dies, Medicaid requires them to pay. If they can’t, their house is taken.
Not just the house is taken, the contents of the house are also taken, jewelry and cars are not exempted. Medicaid state recovery kicks start when the recipient dies.
The spouse of the recipient is allowed to live in the house till his/her death and the house is taken. Get a Certified Elder Law Attorney to help you with it. To avoid Medicaid taking your assets, avoid probate. If you can avoid it, you will avoid Medicaid state recovery.
Final Thoughts
Knowing details about Medicaid in your state will help to know your eligibility status, what Medicaid covers, and how to apply for it. In some states, you have to keep enrolling again to remain covered by Medicaid. But you also need to have a law attorney that can guide you through the program so that you won’t end up losing your house, car, contents of the house, and jewelry.
