Residential care is expensive…more expensive than many of us can afford, but there is help in the form of Medicaid. Each state has different names for this and different standards, although some things are basic government requirements. If you have assets that you want to pass on to your children, you need to start planning early. Any assets you give to your family beyond minimal amounts in the five years prior to your “snapshot date” will still be considered yours when eligibility for financial assistance is determined. This includes trusts. Always consult an elder attorney before making these plans, but here is a simplified outline of what is offered.
The following Medicaid requirements take into consideration the Federal Spousal Impoverishment rules:
- Countable assets of both spouses are totaled as of the date the institutionalized spouse enters a hospital or long-term care facility and stays for at least 30 days.
- The community spouse can keep ½ of this total, up to a specified amount (from $23,844 to $119,220 in 2016 depending on the state). State rules differ. Some states allow the community spouse to keep up to the specified amount of the combined total instead of being limited to half.
- Income of the institutionalized spouse is counted for eligibility, but in most states, that of the community spouse is not.
- The institutionalized spouse can keep about $2000 (differs with state).
- The rest of the institutionalized spouse’s assets must be ‘spent down’ before they will be eligible for Medicaid. This can be spent only in certain ways. For example, it cannot be gifted, except in very small amounts. Don’t wait to give your children anything you want them to have. If you wait too long, it may fall within the five years prior to your snapshot date and will be counted as still belonging to you as far as eligibility goes. Consult an elder attorney about the ways to give gifts, and the limitations involved.
- Community spouses with higher incomes may be required to help pay for cost of the institutionalized spouse’s care. (Varies with states)
- If the community spouse’s income is less than the state’s minimum monthly maintenance needs allowance (MMMNA), then they can keep some or all of the institutionalized spouse's income. (up to $2002.50 a month in 2016)
- The home equity of the institutionalized spouse must be less than the state standard ($552,000.00 to $828,000.00 in 2016).
- The institutionalized spouse is allowed to keep a personal allowance of $60 a month.
- The institutionalized spouse’s medical costs are also considered.
- The institutionalized spouse is required to pay the institution what is left of their income after deducting the amount the amount that can be kept by the community spouse, their personal allowance and the allowed amount for medical costs.
Be aware that these requirements can change as the lawmakers in Washington DC hammer out new rules for the Affordable Care Act.
Assets: Anything of monetary value: real property, art work, savings, pension plans, stocks and bonds, cash, etc.
Community spouse: the spouse who is NOT living in a hospital or residential facility.
Elder attorney: A lawyer who specializes in laws concerning the elderly.
Federal Spousal Impoverishment Rules: Medicaid rules which provide special protections for the spouses of Medicaid applicants to make sure that they have the minimum support needed to continue to live in the community while their husband or wife is receiving long-term care benefits.
Home equity: The fair market value of a home, less debts, divided by the number of owners. Thus the institutionalized spouse’s share of a $900,000 mutually owned home where $100,000 is still owed, would be $400,000.
Institutionalized spouse: the spouse who is living in a hospital or residential facility.
Medicaid: Called by different names in different states. There are basic federal requirements and payments but states can add to these.
Minimum monthly maintenance needs allowance (MMMNA): a minimum monthly income standard for the community spouse, set at one-and-one-half times the Federal Poverty Level for a single person living alone. ($1,991.25 to $2,980.50 in 2016)
Residential care: Care in a hospital or an assisted living, memory care, rehabilitation or nursing home facility for at least 30 days.
Snapshot date: the date a person enters a hospital or residential care facility for a stay of at least 30 days.
For information about Medicaid requirements for long term care specific to your state, go to Find an Attorney, click on your state, and then "Key Medicaid Information" for that state.
For more information about Spousal improvishment standareds:
2016 SSI and Spousal Impoverishment Standards
For information about Lewy body disorders, read our books:
A Caregivers’ Guide to Lewy Body Dementia
Managing Cognitive Issues in Parkinson's and Lewy Body Dementia
Helen and James Whitworth are not doctors or lawyers. As informed caregivers, they share the information here for educational purposes only. It should never be used instead of a physician's or lawyer's advice.