Rhode Island Lady Bird Deed

Quick answer: Rhode Island's Medicaid rule addresses Lady Bird (enhanced life estate) deeds directly. A Lady Bird deed on your primary residence created and recorded on or after July 1, 2014 makes you ineligible for long-term care Medicaid unless you convey the remainder back to yourself; deeds executed before that date are grandfathered.

An enhanced life-estate deed — widely known as a Lady Bird deed — lets the person holding the life estate keep the power to sell, mortgage, revoke, amend, or otherwise dispose of the property while they're still alive. Rhode Island's active LTSS eligibility rule calls this structure out by name, which is unusual; most states never mention the strategy explicitly in their regulations, and that direct treatment matters far more here than a generic claim that the deed 'avoids probate.'

For any enhanced life-estate deed created, executed, and recorded on or after July 1, 2014, the rule makes an LTSS applicant or beneficiary who holds their primary residence this way ineligible — unless they exercise their retained power to convey the entire outstanding remainder interest back to themselves, using a properly created, executed, and recorded warranty or quitclaim deed, and end up holding the property free and clear of that arrangement. Deeds executed before July 1, 2014, however, are explicitly grandfathered and won't cause denial on that basis alone.