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Everybody, once they reach retirement age, is eligible for Medicare regardless of income, just as they receive Social Security. Medicare is the federal retirement health care insurance.
Medicaid however, varies by state and is for the indigent only. In Michigan, they will look back 5 years for moving assets like that.
If you have that much money, you're better off buying Long Term Care Insurance out of pocket or a Medigap insurance policy that will cover your needs.
Lastly, the most you can give any relative in a given year is $12,000 without paying a gift tax. That's a federal thing. It was 10,000 in '04, went up to 11,000 in '05 and to 12,000 in '06.
(Can you tell I have an aging parent for whom we've had to look into all this?)
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