The way Medicaid works is that if the funds/assets are transferred Medicaid can refuse to cover anything for my grandfather because they will say he had the assets and transferred them to her (in the mind of Medicaid, he is trying to hide assets to avoid them getting it). I know this because I called the Elder Law hot line here in IL. So there is a huge risk on his part because she manipulated him into transferring funds/assets to her name.
I think something is getting lost here. Every month all but 1800 a month is leaving his accounts. She automatically gets 1200 and then the other amounts allegedly go towards his needs. But for arguments sake we will say that the other funds go towards his food/utilities and upkeep of the house and car. If she gets an additional 1500 that means he will be left with 300 a month to put into savings. That leaves very little financial cushion should an emergency arise.
The best way to deal with this is to have a trust set up so someone, a third party, oversees his finances and makes sure the money goes towards his care with some money being dolled out to her.