Why risk litigation over asset transfers?

Recently, a New York appeals court held that a Medicaid applicant who transferred money when she was in good health and two years before entering a nursing home presented enough evidence to rebut the presumption that she transferred the money in order to qualify for Medicaid. Sandoval v. Shah (N.Y. Sup. Ct., App. Div., 2nd Dept., No. 2014-11442, 2767/13, Sept. 30, 2015).

Between May 2007 and April 2008, Cecelia Sandoval made several transfers to her children to help them pay bills. She had more than $250,000 in assets remaining after these transfers. In 2010, Ms. Sandoval began exhibiting signs of dementia and entered an assisted living facility and eventually a nursing home. After she depleted her assets, she applied for Medicaid. The state imposed an 11-month penalty period.

Ms. Sandoval appealed the penalty period, arguing that the transfers were not made in anticipation of the need to apply for Medicaid benefits. The state affirmed the penalty period, and Ms. Sandoval appealed to court. 

The New York Supreme Court, Appellate Division, granted her benefits, holding that Ms. Sandoval presented enough evidence to rebut the presumption that she transferred assets in order to qualify for Medicaid. The court rules that the fact that at the time of the transfers, Ms. Sandoval was in good health and living independently and that she still had $250,000 in assets after making the transfers is evidence the transfers were not motivated by a future need for Medicaid.

Great news for the Sandovals, right?  Well, no.  Good news for sure, but not great because the ultimate result begs two questions: 1)  How much pain, uncertainty and anguish did Ms. Sandoval’s family have to endure as a result of her lack of quality Life and Legacy Planning, in order to obtain this result?  2) How much money did the Sandovals have to spend in attorney’s fees to obtain this result?  The plain answer to both questions, in all likelihood, is a significant amount.   

If you’d like to use Ms. Sandoval’s family’s anguish as a learning experience, and see how Jeffrey P. Reisner, Esq. can assist you and your family with life and legacy planning, to protect your family’s assets from creditors and predators, AND help you avoid probate and expensive litigation, contact us today!