Getting it Straight with Medicaid
Oct 27, 2015
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When a loved one needs to be admitted to nursing home care, there are many questions to be asked in regards to nursing home care, as well as to Medicaid coverage and eligibility. The eligibility process can be a daunting, exhaustive maze of nitty-gritty rules and regulations and many have had their applications failed due to minor mistakes that could have been avoided.
Often the expertise of a Medicaid planning company like Senior Planning Services is recommended to guide one through this process while the applicant can remain focused on the myriad nursing home details. Let me break down some of the complexities into bite-size, comprehensible pieces of information:
What is the asset limit I can keep and be eligible? The asset limit is $2000 for Nursing home, assisted living and community Medicaid.
What are assets that count for Medicaid eligibility? Savings accounts, CDs, stocks, bonds, mutual funds, IRAs, life insurance with a face value of $1,500 or more, among others.
What assets dont count? The primary residence is excludable when there is a community spouse residing in the house. One vehicle may be kept for the community spouse, personal possessions are not counted, as well as German Reparation funds, special needs trust set up for a disabled child, a prepaid irrevocable funeral trust and burial plot. There may be some other exclusions that need to be determined at a case-by-case basis. Contact a Medicaid consultant for further exclusions.
Can the spouse keep any of the assets? Generally, Medicaid will divide all the assets in half, one half remaining with the community spouse while the other half will need to be spent down in order for the applicant to be eligible for Medicaid. In addition, the spouse that is not applying for Medicaid, often referred to as the community spouse, may also keep the primary residence that he /she is living in and one vehicle.
Can the children keep any assets? In some cases, Medicaid will allow the children of the Medicaid recipient to remain in the primary residence. If there is a child under the age of 18 or if the child is disabled or blind they may keep the primary residence in most cases. Another example would be if an adult child were to move in and provide full-time home care for two years prior to the applicants admission to a nursing home, they may keep the primary residence. In this case, Medicaid will require proof that the adult childs care prevented the parent from being admitted to a skilled nursing facility sooner .
Can any purchases be made with assets to help eligibility? Yes, this is called spend down. There are many qualified purchases that can be made to lower ones assets below the limit. Some examples are; buying toiletries and clothing that the applicant can benefit from once he/she is already on Medicaid, setting up a prepaid irrevocable funeral trusts and some others.
Whats the income limit for Medicaid-sponsored nursing home care? This amount varies from state to state. In NJ the income limit is $2,163 for nursing home, assisted living and community Medicaid. If ones income exceeds this cap they may still be able to qualify for Medicaid by setting up a Qualified Income Trust (QIT). The excess income will then go into the QIT. The funds in the trust can then be used towards the care of the applicant. If the trust is set up correctly, as mandated by federal and state law, the excess income will not impede the applicants Medicaid eligibility.
Whats considered income? Salaries, wages, pensions, social security checks. Financial assistance, such as Food Stamps, HUD, Home Energy Assistance Program, etc. is not considered income.
How much income can the nursing home resident and family keep? The resident may keep a minimal PNA (Personal Needs Allowance) of $35 per monthly, the amount towards a secondary insurance premium. If the community spouses income is below the Monthly Maintenance Needs Allowance of $1,966.25 he/ she may keep some of the institutional spouses income until the total monthly income reaches $1,966.25. In some cases the community spouse may be able to keep more income if he/she proves that her monthly expenses are not covered by this income. Medicaid will need to see utility bills, outstanding medical bills, etc. in order for her to qualify for a higher monthly maintenance amount.
Conclusion: These are some FAQs that I often come across. Rest assured that when your loved needs long-term nursing home or assisted living care, there is help out there that can guide you through the Medicaid eligibility procedure.
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