THE BLOG

Is This Devil Really a Saint?

05/22/2013 11:16 EDT | Updated 07/22/2013 05:12 EDT

Susanna Kim of ABC News came out with a report on Wednesday which is spreading across the Internet like wildfire. The screaming headline says it all: "91-Year-Old Man Raises Money to Prevent Eviction by Daughter." The Huffington Post has published its own story on the episode.

The 91-year-old World War II veteran John Potter's daughter, Janice Cottrill, is evicting him from the home he built 56 years ago in Zaleski, Ohio. In 2004, Cottrill used the power of attorney Potter had given her, and transferred the deed of the home to herself. Two years ago, upon learning of the transfer, Potter transferred that power of attorney to Cottrill's daughter, his granddaughter, who is siding with him in the dispute.

You can imagine the epithets that are being hurled Cottrill's way on the blogosphere: evil, heartless, and greedy are some of the kinder ones. On its face, Cottrill is the guilty party and we -- the public judge, jury, and executioner -- justified in our outrage against her.

However, there may be more to this story than meets the eye. The devil in this story may, in reality, turn out to be a saint.

Many seniors purposely transfer their assets to their children in anticipation of having to qualify for "Medicaid Spend-down". Remember: this is the U.S. where the average annual cost of long term care is about $75,000 a year and the average stay is two and a half years. One in three seniors will enter a nursing home.

Medicaid will, under certain circumstances, pick up the tab for the cost of long term care. However, the beneficiary must first spend-down his or her assets to a specified minimum before they can qualify. This minimum is, generally: one principle residence, a car, furniture and other assets deemed essential for self-support. After death, this "protected" minimum then becomes subject to liens by the government if there is an outstanding "tab" on Medicaid benefits received. Indeed, Medicaid gets preferred creditor status and receives money owed from the estate before heirs.

Often, the reasoning will be: "I want my heir(s) to get my assets when I die, not the government. Why not transfer my assets to my daughter now so that I won't have to spend them during my lifetime if and when I have to enter a nursing home." Medicaid knows this and has instituted the look-back rule: this allows the government to "look-back" five years from date of transference and, for the purpose of seizing assets, null and void the transaction.

It is entirely possible that, back in 2004, the father willingly and knowingly and, indeed, even encouraged his daughter to transfer the deed to her name.

Fast forward nine years to today and 91-year-old Mr. Potter may now need round-the-clock care which has fallen upon the daughter. I suspect that Cottrill has been, for the past nine years, her father's primary care giver. If so, I can only imagine how taxing and exhausting the job has been, one that will only get worse. It very well may have been in addition to her own part or full time job. Or she may simply be exhausted now and can no longer expend the energy to care for him nor able to pay for in-home care (real property was transferred to her, not cash).

As a man of advanced age, the father may have simply forgotten the circumstances surrounding the transfer. On top of that, no senior looks forward to the prospect of entering a nursing home; like the Roach Motel, they know all too well that you check in but never check out. The granddaughter, who is siding with her grandfather, may not have been privy to the agreement between father and daughter -- her mother -- with whom she may have her own, separate mother-daughter issues (what child doesn't?). And because Cottrill doesn't want to get in trouble with the government (transferring assets to qualify for Medicaid spend-down may constitute fraud) or is unaware of the look-back rules, she is keeping mum about the circumstances of what transpired back in '04.

Contrary to the unflattering picture that has been painted of Cottrill, the reality may be the exact opposite: a loving daughter who has selflessly devoted her time and energy to caring for her father for the past nine years but is no longer able to. Indeed, the ability to care for him may have reached the point at which only a professional can competently and responsibly do so. Ms. Cottrill may very well be the victim of circumstances: an over extended Medicaid program, complex spend-down rules, and a long term care industry that can bankrupt even those with a net worth of $500,000.

Let's not jump on the "lynch Cottrill" bandwagon until all the facts are in.