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Thread: Would you lie to preserve your money?

  1. #1
    Senior Member flowerseverywhere's Avatar
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    Would you lie to preserve your money?

    So I had a weird experience today. Talking to an old friend, they are thinking of getting divorced on paper so the one that has long term care insurance could put all the assets in their name, and the other could go on Medicaid if they needed long term care. Purpose would be to leave all their assets to their children. They would still live together. If the non long term person needed care they would private pay for a few month then refuse to pay more and they thought the facility could not transfer them. But I did not believe that a facility has to keep you if they don’t take medicaid. They can’t dump you on the corner but they can transfer you.

    background, two social securities, two smaller pensions, new paid for house, two newer cars, travel overseas about a month a year, going out to eat several times a week. Furniture and clothes newer and very nice. Have no problem hopping in the car and going on a day trip. Fly three or four times a year to see the grandkids. In other words, very nice upper middle class life.

    For years i have listened to this person talk about how horrible everyone else’s values are, how everyone lies and cheats and so on. So I asked who did they think would pay? “ Medicaid plus the private pay patients. “ I questioned if they thought that was ethical? Well, “you would be surprised how many people do this”. Then they said”it’s so expensive they should charge less”. Well they don’t.

    So what do you think? Would you do this? Under what circumstances?

    Children are college educated, graduated with no loans. No unusual circumstances like a special needs child or illness. Frankly, I never thought about it. Spouse and I have talked about it and we would do everything we could to keep the other in the home with help.

  2. #2
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    I would do it if I was afraid my medical expenses would leave my spouse dependent on our children.

    they can transfer you.

    btw, I don’t see it as a lie. I see it as a legal divorce. People I love had to survive for years without the benefits of a paper marriage. The government makes the rules, the people play the game.

  3. #3
    Senior Member iris lilies's Avatar
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    I considered, and still will consider, a similar divorce but in these specific circumstances:

    My spouse should not be impoverished by my own physical illness, that is my ethical stance. In the advent of me getting Alzheimers, a likely scenario, we might divorce and would split our assets in half. That seems reasonable and ethical to me, that he get half of the assets he is responsible for creating.

    The last time I looked into it, a scenario which has me in a nursing home calls for all of our joint assets to pay for that before Medicaid kicks in. The only assets my spouse can keep are

    1) his own income from Social Security
    2) our family residence
    3) cash up to $80,000

    The rest of it must go to support me in the nursing home.* Well, that amount that he is allowed to keep is peanuts.

    As it turns out, I have enough income to cover half the cost of a nursing home and would be able to pretty easily cover the rest for seven years, the average stay in a nursing home. That leaves my spouse with a Social Security income that is very modest BUT also leaves him with a lot of cash. Plus, he could always works a little if he needed to.

    OP, the scenario you describe is not without risk for the spouse who ends up with no assets. I wouldnt do it because of that risk.

    I pretty much agree with CL. The gubmnt makes the rules, it is a game to play the rules to your advantage. It isnt much different from us taking those Obamacare subsidies ( which are pretty hefty this year, we are paying $0 in premiums**) which are intended for folks of modest means. We are folks of modest income, but not modest means. But NannyG looks only at our income.

    *I am not entirely sure if my spouse coukd keep his 401k assets in this scenario

    ** so far this year the preiums for our health insurance plunged to $0 and I dont know why, but it will all be revealed at tax time.

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    IANAL, nor am I up on current law. They should be seeking true legal advice and not what I suspect is advice from someone who comes to town to give a talk and sell books.
    There used to be (and I believe there still is) a federal rule that required medicaid to go after recoverable assets, which at one time could go back five years (prior divorce).
    That doesn't count that a divorce still requires approval from a judge, so it they see something they think of as fraud, they could issue judicial orders changing division of the property to what is required by their rules/law.
    Money and a lot of the law is amoral. People values however are what your actually discussing/judging here.

  5. #5
    Senior Member bae's Avatar
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    Government involvement in marriage is horrid, and thus I don't feel compel to concern myself about the morality of navigating around the rules of the institution in order to protect my family.

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    Quote Originally Posted by bae View Post
    Government involvement in marriage is horrid, and thus I don't feel compel to concern myself about the morality of navigating around the rules of the institution in order to protect my family.
    +1

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    Some programs like Food Stamps look at household income regardless of marital status. I thought Medicaid did also in my state, but if not maybe it should.

    I know a father whose son got cancer. He was either uninsured or underinsured so to ensure his son got the treatment he needed he turned custody of him over to the state. The state then placed him as a foster child with his own father. That wasn't dishonest, but is an example of government regulations standing in the way of family values, and the problems created by lack of comprehensive national health insurance. I wonder how single payer countries handle long term care.

    I will never get legally married again because I don't want to be potentially impoverished by another person.

  8. #8
    Senior Member catherine's Avatar
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    Now, if we had universal single-payer healthcare, all of this would be moot. We could all stay married. One of us gets sick and the taxes we have paid covers the cost of long-term care. Easy.

    (Just a question: What makes the middle class "gaming the system" more ethical than the lower class doing the same thing? I hear a LOT of people shaming the lower classes for doing the same thing)

    I knew a couple who divorced for the reasons in the OPs scenario. I was in my twenties at the time and I thought it was terrible, and I looked at the spouse as a cheater, liar and thief. Now I'm older and I see that there are always shades of gray in ethical decisions. So I've actually been thinking hard about this question. I remember how sad and angry I was when my great-aunt died, and had never changed the will to keep her sister, my grandmother, from inheriting it. My grandmother had been in a nursing home for a few years, and the State had to be paid back.

    But here's a question: What about long-term care insurance? How good is it? If I got a policy now, at age 66, would that protect my husband if I found myself needing one down the road? Would that eliminate the need for a divorce?

    I still want to say that people who get a divorce to take advantage of government healthcare services are acting unethically in the sense that they are gaming the system, but I agree that the whole government/marriage marriage isn't always very functional or reasonable. So, my first choice is get us Universal Single-Payer Healthcare, but in the absence of that, my second choice is for iris lilies' DH to get to live off the fruits of his labor for as long as he can, in any way he can.

    But I wonder how this situation is different from the family that sells their home to pay for healthcare for any expensive disease? In life sh*t happens, right? I usually believe in Kant's Moral Imperative. So, I guess I still believe that lying to the government is unethical in the pure sense of the word, but OTOH marriage is such a complicating variable. We GET married for joint social security benefits, so why can't we get Unmarried for the benefits that the dissolution might get us. It's complicated.

    But if we had Universal Single-Payer Healthcare, we wouldn't have to debate the ethics of the OPs query at all.
    "Do any human beings ever realize life while they live it--every, every minute?" Emily Webb, Our Town
    www.silententry.wordpress.com

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    Isn't there a look-back period aimed at catching that kind of thing?

  10. #10
    Senior Member SteveinMN's Avatar
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    Quote Originally Posted by catherine View Post
    (Just a question: What makes the middle class "gaming the system" more ethical than the lower class doing the same thing? I hear a LOT of people shaming the lower classes for doing the same thing)
    Not to veer too far off-topic, but the upper classes game the system as well. Many huge companies and upper-class individuals go to great lengths to use the system to pay as little income tax as possible; sometimes even no tax at all. As well as other tax advantages and investment strategies. Though I wish it were different in Utopia, I see no reason the middle class needs to be any more ethical about this than other classes.

    DW and I have discussed this as a strategy, but it has remained only discussion so far.
    If Americans expended even a fraction of the energy on civic engagement that we spend on consumer ideology, our democracy would be much healthier. Can you imagine people camping out to vote? -- Charles Roberts, Amherst, Mass., Nov. 25, 2006

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