The parent(s) can explore the possibility of donating the property (home) to an agency that provides Medicaid Waiver Services. Any agency that provides waiver services has a contract with the county board of developmental disabilities, and the county board provides oversight of those services. These agencies are sometimes referred to as service providers. Not all agencies will accept property as a donation.

Typically when the parent(s) considers this option, it is with the plan and expectation that the family member with a disability will live in the home, and the agency will provide Medicaid Waiver services such as staff support for their family member.  As the parent(s) considers this option, they can keep in mind that this option is unique in that it blends the ownership of the home and the provision of services to live in that home – the provider agency is the homeowner and service provider.  The pros and cons of this are outlined below.

The agency will determine if it is able to accept the property as a donation. The agency will likely complete an assessment of the state of the property, and determine physical and capital needs to improve or maintain the property.  The agency may determine the property’s current status by reviewing the neighborhood, layout, parking, safety, upkeep demands, accessibility, status of any easements, mortgages, liens, etc.  After that review, they can decide whether or not the property is suitable to accept as a donation. Additionally, the service provider may require a lump sum of money in addition to the property to ensure they can maintain the property in the future.

Once the agency agrees to accept the property donation, the parent(s) and agency can develop a contractual agreement that outlines how the property will be used, who will live in the property, and any other stipulations that are mutually agreeable. Parents and the agency can discuss expectations about what happens if/when the family member with a disability has needs that no longer align with living in the home (e.g. the family member has accessibility or health issues).

The parent(s) should be aware that any agency that provides Medicaid services can, for any reason, give a thirty-day notice to terminate services.  So, at some point in the future, if the agency decides to terminate Medicaid services to the family member with a disability, this may make it necessary for the family member to move. (See: Information and Resources: Provider Agencies and Housing.

The agency is required to provide a written lease agreement to any tenant, even if the parent(s) have donated the property where the family member lives. The family member with a disability will pay rent. If the agency did not charge rent, this would  impact family member’s public benefits (see In–kind support and maintenance).

At the point of donation, the parent(s) will no longer make day-to-day decisions about the operation of the property. All property management responsibilities and liabilities will transfer to the agency. The agency will be responsible for ensuring the condition of the housing, and will assume any injury or loss liabilities stemming from the property. 

Parents considering this option will want to reach out to the agency well in advance to discuss the feasibility of this option. Donation of the property should never be a surprise to the agency. The agency can refuse the bequest if they were not involved in the planning prior to the parent(s)’ death. The parent(s) can donate the property either through estate planning or during their lifetime for the benefit of a family member with a disability.

Parents should recognize that their property may not be suited to the purpose they envision. Parents who are thinking of donating a property upon their death as part of their estate planning will need to routinely evaluate their property. They will need to have an objective review of the factors that determine the property value.