Short answer: Yes, if the child lived in the parent’s home for at least two years immediately before the parent entered the facility and provided care that let the parent stay home instead of in an institution. The care has to be shown to the state’s satisfaction.
The caregiver child exception (42 U.S.C. 1396p(c)(2)(A)(iv)) lets the home be transferred to a son or daughter without a transfer penalty when:
- The child lived in the parent’s home for at least two years immediately before the parent became institutionalized; and
- The child provided care that permitted the parent to live at home rather than in a facility, as determined by the state.
Expect HHSC to want evidence: proof of residence, physician statements about the parent’s needs during those two years, and a description of the care. A family calling someone a caregiver is not enough.
This is a different rule from Texas estate recovery’s one-year protection for an unmarried adult child living in the home at death. The deed itself should be prepared by an attorney.