When applying for Medicaid for a nursing home, how strict are they with documentation as in saving receipts, etc during the lookback period?

Medicaid's documentation requirements during the lookback period can vary, but they often focus on large transfers or asset shifts. While some people have experienced scrutiny down to grocery receipts and cash withdrawals, it’s more common for Medicaid to request proof for significant expenses like rent, utilities, or large purchases. The key is to keep clear records and be prepared, but don’t stress too much about every single receipt. Just ensure your big transactions are well-documented. Many have gone through this without too much hassle, so stay positive—you got this!

Banking and checking account records for the last five years are ALWAYS a wise thing to keep, and this is the lesson for anyone of "an age" out there. These, handed over, will allow the authorities to question anything they feel they want to question. They seldom question normal withdrawals. For instance, they may look at something and say "What was this withdrawal of 7,000 in cash? What was that for. Did you gift that money to someone?" If you have a checking account log, or notes on your monthly checking account what a withdrawal is for, then you can easily reply. For instance you can say "I made a one month vacation trip to the Virgin Islands then; this was my spending money for motels, meals, transportation".

They do not "nickel and dime". The are for the most part interested in withdrawals of 4,000 or more that seems to have not been used for rental, groceries, et al, but to have happened out of the blue. If you say "I went to Ikea when I did my bedroom over; this was my spending money for carpet, bedding and a few items of furniture" it's unlikely you will be questioned on such a thing.

My Moms bank statements were my proof. It showed the money coming in and going out. I am lucky, for a small fee Moms bank showed copies of her canceled checks. They look for inconsistencies. There is no way that anyone keeps receipts for groceries for 5 years. But if they had a roof put on the house for 10k, I hope they have that receipt. If I needed to pay out of pocket for something Mom needed, those receipts I kept and wrote myself a check once a month. The receipts went into an envelope with the check # and the month on the outside. I don't think I provided any bills, they are showed on her statement. I know of no one who saves bills for 5 years. And really, do you think a caseworker has the time to go thru all of this.

Call Social Services and ask if you can make an appt with a caseworker. Thats what I did before I made any decisions.

TME, what the caseworker - in my experience - is looking at is the pattern of spending based on their baseline income and assets; and if the pattern makes sense for the applicant to now be impoverished at a mere $2,000 in non-exempt assets (for most States). Caseworker aren’t doing this on their own, they have a program to input data based on what the applicant or their POA supplied and also based on other internal databases they have access to.

When they apply, either the caseworker accesses or the applicant submits their “awards letters” which are the letters that SSA and other pensions send out in Nov that state to the penny what will be paid to them for the incoming year. That’s a baseline for determining their income (side note: income max for most States is $2829 a mo*.) Applicant also submit bank statements that provide an asset balance from 3-5 years prior. & they can easily search State database to see if any real property sold and to the penny. If they had or still have a home, that will provide very much fixed spending (taxes, insurance, utilities, etc). It’s just a few keystrokes to accomplish.

Say a dad gets $2500 mo. income from SSA = 30K yr. And his 2020 EOY bank balance was 50K; sold his house for 350K in 2021 and has been living with his daughter ever since…. it does not make sense for this dad to be at 2K in assets. There should be $, like 200K range of $. Medicaid does not expect him to live on air & paying the daughter $ for a portion of household costs is ok & it’s factored in. But this dad went through basically 400K in 3 years….there is just too too too much of a discrepancy. Could be valid reasons, like super costly prescriptions, or that 350K house had a mortgage and a HELOC and delinquent property taxes, so sale only netted 150K. Caseworker looking for legit reasons why he is now impoverished and impoverished without it being he gave / gifted $ to others. That is why a caseworker will want details on items that don’t fit a pattern of spending.

* if income over the max, then look to do a Miller Trust or whatever system your State does for pooled income for those over resourced.

A ? for you… that caregiver agreement was done btw your mom and an independent caregiver (not an employee of an agency) . Right? How are they getting paid… like as a household employee with FICA, W-2 done? Or is mom paying as if they are contract labor? And you are keeping timesheets and paying by check based on those time sheet's?. Or they are invoicing?

If mom had / has a home, State will want details on the house. Like the last tax collector bill. Ditto for autos. Both of these has maximum value allowed and the figure varies by State.

Has anyone mentioned to you the SOC aka Share of Cost?
For LTC Medicaid - the program that pays for custodial care costs in a facility - it requires the applicant to do a share of cost of basically almost all their monthly income (like their SSA) paid to the NH. Less a smallish Personal Needs Allowance / PNA. Varies by state with most doing $50 or $75 a month PNA. So because of this if mom has credit cards, a mortgage, life insurance premiums, car note, other property costs, she will have no $ to pay those costs. Stuff will default. Yes, LTC Medicaid allows them to retain a home and a car as an exempt asset for their lifetime but family will have to pay all costs and then be prepared to deal with the required Estate Recovery attempt after death in some way. Often families are gobsmacked by the SOC.