The subject of sharing a residence with an elderly parent is one that is fraught with little tiny problems that are completely counter intuitive. Because the regulations for Nursing Home Medicaid are written with the intentional purpose of trying to exclude people from accessing their benefits under the law, those regulations can make ordinary and practical kindness into an administrative nightmare.
The problem that people face in all of these situations is that there is a presumption, under the law, that anything transferred to a family member within 5 years of entering a nursing home and applying for Nursing Home Medicaid Benefits was transferred for the purpose of making the senior eligible for Medicaid. The burden of proof then falls on the senior to prove, item by item, that they did not make the transfer intentionally to qualify latter for care. The rule is contrary to common sense, and to the types of things that parents and children just naturally do with and for each other, but it is the rule nonetheless.
The best way to handle living with a parent, or having the parent live with you, is to see an experienced elder law attorney to draft a residential care agreement and to become familiar with the record keeping that will have to be done to not run afoul of implied gift rules. As our parents age we do not tend to think of how the decisions we make, large and small, will affect them in the next 5 years, we tend to focus of keeping happy and healthy now. But, since there is an overwhelming statistical likelihood that the senior will spend some time in nursing home care, and since that care is $4,000 to $7,000 per month, planning for that very real contingency should be topmost on people’s minds.