My sister was promised the house, and she recently sold her own house so she doesn't have any place to live except my mom's house right now. She and her fiance aren't good at managing money and have been struggling with maxed out charge cards since before my dad even got diagnosed with cancer. So they can't afford to move anytime soon, and they were counting on living rent-free with my mom as way to get out from under their debt and start saving some money.
That's why we need to talk to an attorney that specializes in estate law. I want to see if we can get the house set up in an inter vivos trust managed by my sister, so that my mom isn't required to sell the house before Medicaid would take over the cost of the nursing home. That way, my sister gets to keep the house as a reward for all the time and effort dealing with my mom. Otherwise, if my mom just gave the house to my sister or even sold it to her at a bargain price less than five years before my mom tried to go on Medicaid, they will refuse to cover her. If the trust is set up properly, the house is not an issue for Medicaid. The only other way to protect the house is if my mom doesn't end up in a nursing home until close to the end. My sister vowed that we would never put my mom in a nursing home, but I bet a lot of people make that kind of promise and then need to break it. But I'm an accountant, not an attorney, so I want to get expert legal advice in this matter.