It is true that a person in America can sell his/her property or give it away as he or she chooses. But if the purpose in making such a transfer is to avoid the requirements of Medicaid laws, care must be taken.
Medicaid law basically says that we all have to spend our own assets down to pretty much nothing before we can make application for public assistance -- that's what Medicaid is. It would be considered a fraud on the government for a person to give his/her property away and then apply for Medicaid assistance. But if the gift was made more than 5 years prior, then there is no such presumption.
So, if she is willing to give up her ownership interests now, she has the right to do so. But you will have to wait and seen then whether she can make it for 5 years before there is a need for Medicaid help. (And this assumes, of course, that the 5 years threshold will not be changed in the future.)
Answered on Jun 26th, 2012 at 8:54 PM