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The US Treasury Department has series I and series EE savings bonds which are non-negotiable or non-transferable. Only the owner of the bond can be paid and the minimum holding period for these bonds is minimum 12 months from the date of purchase. During this period, the bonds cannot be redeemed and one individual is allowed to purchase up to $30,000 worth of these savings bonds in a calendar year.
These bonds can be used as asset protection if the person is Medicaid applicant. He or she can invest $30,000 in each series so that the total investment does not exceed $60,000 and this has to be done before filling out the Medicaid application. Once this is done, the savings bonds will not be considered as available resources to fund a medical treatment in a nursing home.
On the other hand, if the person keeps no more than $4,200 of non-exempt funds in his or her name, he or she will be immediately eligible to receive Medicaid coverage in a nursing home.
Now let us assume that the Medicaid person is still living 12 months after he or she bought savings bonds initially, then the bonds can be redeemed and the Medicaid claimant can pay the nursing home costs in the thirteenth month from the money received after redemption, and then using the leftover money to buy more savings bonds so that the Medicaid can continue for another 12 months as the money would once again be considered as unavailable resource.
In addition, the person should designate the beneficiary who will receive the bonds upon his or her death so that the County Department of Social Service cannot proceed with an estate recovery action.
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