He also wants to deed or sell his house to me as I will be giving him medical care at no cost until he passes allowing him to remain in his home, we are not related. The question is since he receives Medicaid can he leave the house to me or sell it to me before his death?
In terms of him trying to deed the house to you, my experience is that he would have had to have done that years ago. When a nursing home became the reality for my mom, it was then and only then when she suddenly wanted to "protect the house." However, Medicaid requires disclosure and FIVE years worth of data to prove the person is truly poor and NEEDS Medicaid. In other words, one cannot sign away assets (house, car, money, insurance policies, etc) and then claim poverty and go on Medcaid. If my mom wanted to "protect the house" my thinking is that she should have done that at least 5 years earlier and maybe it would have been exempt. We had to liquidate everything to satisfy Medicaid: we had to sell her home, sell her car, cash in her insurance policies, prepay her funeral and then use any remaining money to pay the nursing home.
If your friend sold his house to you, that might be an option. BUT he would need to sell it at the going price for his neighborhood. Multiple people told me that I could buy my mom's house for a pittance just to get it out of her name and into my own name. This is NOT true. Since Medicaid is putting out funds for your friend, Medicaid is looking to recoup whatever they can. Again, you can't give away assets and then turn around and claim to be "poor" and in need of Medcaid.
The fact that you are an unpaid caregiver I think does not have any bearing on this. Seems like you should be entitled to something, but Medicaid wants to know where the assets went & proof needs to be provided. I was never paid for care I provided, but I suppose there could be legit options? Don't know.
I wish I could make this a little nicer sounding, but this is what happens when Medicaid arrives on the scene. We basically had to liquidate Mom's estate while she was still alive. Very draining for all concerned. Anyone who was expecting to inherit money from her is going to be sorely disappointed.
He can pay you for your bedside care. I don't know if that debt would be paid out of the value of the house before or after Medicaid's claim.
I suggest, though, that you/he consult with a lawyer who specializes in Elder Law. These folks know Medicaid rules and practices inside and out. If there is a way to make this situation more advantageous to you, they will know it.
Perhaps start by calling your Senior Help Line (Area Agency on Aging) and asking if they have any legal counselor's available, or get a referral to an Elder Law attorney.
OP, check into the laws in your state. In many states whether an asset is subject to medicaid recovery is simply whether that asset goes to probate or not. So a transfer on death deed will prevent medicaid recovery since the transfer happens upon death and there is no probate. I would suggest you at least do a initial consultation with a medicaid attorney.