Situational Ethics, Again

[Hunter]

I'm curious as to how y'all feel about the following.

It may be legal to arrange your financial affairs so as to shield your assets from future medical and nursing home expenses; in other words, give assets to a trust or family members so as to: (a) become Medicaid eligible, or (b) prevent the state from recapturing (from your estate) the amount paid on your behalf by Medicaid . Typically the motiviation is to protect your assets so there will be more available for your heirs; of course, by doing so the government is paying what you could otherwise pay.

I'm a bit conflicted over this issue. Anyone care to share thoughts?

 

[Bill Ohio]

of course, by doing so the government is paying what you could otherwise pay.

The government is paying with YOUR money, presuming you've paid taxes. If you're well off, you've paid WAY more than you've likely received in benefit. In fact, you may have been supporting dozens of others (who probably despise you anyway for being successful) for years.

However, you should consulting a financial planner and an attorney for sound advice, and you might consider consulting with your minister/pastor/whomever rather than airing this out on a shooting forum. Unless you're trying to stir the pot.

Gauging moral issues by what the government does is a shakier premise than Katharine Hepburn building a house of cards atop dry sand above the San Andreas faultline.

 

[xs hedspace]

About as ethical as those corporations opening a PO box in the Bahamas, to escape US taxes. Depends on how smart your lawyer is...can you trust a lawyer? Can you trust the gov't? Ask any American Indian. Sorry, not much help here...

 

[Dick Grosbier]

Gauging moral issues by what the government does is a shakier premise than Katharine Hepburn building a house of cards atop dry sand above the San Andreas faultline.

Gotta agree with Bill on that,
Congress the Senate and POTUS are the heads of our government. Now there is a truly ethical group for you. Virtually nothing they pass for the rest of us is good enough for them to make it applicable to themselves.

 

[Frank B]

You need to understand Medicaid's rules before you play their game. If you are trying to sell/transfer title to your house to keep them from putting a lean on it, you need to know their time frame. It could be several years. Later! Frank

 

[Wilbur]

Used to be 5 years - don't know now.

Yes, it's not that long a read....make sure you do and understand what you read. I think you'll find it very easy to understand and it ain't pretty unless you planned way ahead.

 

[blades]

Believe as far as any of the health stuff goes they can go back 7 years now. Could be even further. To me this is a real crock, considering the extreme over charging, duplicate billing to insurance as well as yourself ( yes they do this all the time, claiming that it was refuted by the ins or medicare/aid) with threatening letters and such if you do not pay in a relatively short window time wise ( always way shorter than avg. private ins response time. Medicare/aid is even worse ) and of course they dink your credit record besides if the ins is slow to pay makes for a real nightmare. Just nailed one of health care providers for 12 grand for what is written above, course it took 3 years to do it. Likely take 6 years to get off the credit record, if at all.

 

[vicvanb]

Of course it's unethical

Typically the motiviation is to protect your assets so there will be more available for your heirs; of course, by doing so the government is paying what you could otherwise pay.

That's really the crux of it, isn't it--the government paying what you should pay?

According to some political factions, "we're broke," and the "entitlement" programs like Medicare and Medicaid will bankrupt us in the future unless we reform them now. So how can we promote efforts to shift payments to Medicaid that we could otherwise afford? Seems to me it is clearly unethical.

 

[Hunter]

That's really the crux of it, isn't it--the government paying what you should pay?...Seems to me it is clearly unethical.

I may agree with you; however, as stated, I'm a bit conflicted -- after all it may be legal. Also, I'm concerned about whether such conclusion endangers other heretofore unquestioned actions/conclusions. I don't mind being wrong, but I hate to be inconsistent.

I would enjoy discussing this with you face-to-face; are you ever in the Atlanta area?

 

[vicvanb]

One other related point--when I turned 65 I had two excellent health insurance plans (my own and my wife's) that we planned to continue paying for (still have them both today) and I would have opted out of Medicare if given the choice. But there was no choice. Everyone is forced into Medicare. There are a lot of seniors like me who don't need medicare but yet Medicare is our primary coverage and it unnecessarily pays a lot for our health care. I wonder how large the Medicare savings would be if those of us who could opted out?

 

[Hunter]

That's really the crux of it, isn't it--the government paying what you should pay?

Four more stuations for your consideration:

1. I "give" assets to a friendly party and then, after waiting the appropriate amount of time, I file bankruptcy (not listing the aforementioned assets on my court papers). Legal, yes; ethical, Y/N?

2. I person transfer my assets to my spouse to make myself judgment-proof from a possible valid claim in the future. Legal, yes; ethical, Y/N?

3. A person who can afford to pay cash for a house finances it, letting the gov't subsidize his mortgage payment. Legal, yes; ethical (given the conclusion(s) above), Y/N?

4. Vendors are giving away free food samples and I keep going back for more, and more. Legal, yes; ethical, Y/N?

This ethics stuff can be hairy.

 

[vicvanb]

1. I "give" assets to a friendly party and then, after waiting the appropriate amount of time, I file bankruptcy (not listing the aforementioned assets on my court papers). Legal, yes; ethical, Y/N?
2. I person transfer my assets to my spouse to make myself judgment-proof from a possible valid claim in the future. Legal, yes; ethical, Y/N?

Not sure these are legal in all states--you'd better hope that as the bankruptcy and judgment cases go forward your "strategy" is not revealed and you are not only liable for the "gifts" and "transfers" (fraud?) but also for failure to disclose them.

Even if they pass the legal test, these deliberate acts to hide assests rather than use them to pay legitimate debts seems clearly unethical to me.

A simple test--how would you feel if someone who owed you money hid their assets in this manner? I'd bet you would think there was a serious breach of ethics.

 

[blades]

# 2 won't fly at all all funds considered mutual , hell even if you gifted funds to your offspring in less than their back track time they will go after those funds as well ( this action is taken even if you were not sick or had no knowledge of an affliction at the time, assisted living and nursing homes are the worst at this) What is sad is the courts seem to allow it. They will attach liens to anything of value. Like a plague of Locusts.