(g) An individual who is a beneficiary under a qualified state Long-Term Care Insurance Partnership Policy is given a resource disregard equal to the amount of the insurance benefit payments made to or on behalf of the individual for long term care services when determining if the individuals countable resources are within the program limits to qualify for Medicaid. Income & Asset Rules; Spend Down Period; Spend Down Calculator; Look-Back Period; How Medicaid Counts Income; How Medicaid Verifies Income & Assets; . Some people want to qualify for Medicaid but have too much money to meet the program's income requirements. Pregnant Women; 3. For example, a Medicaid applicant may purchase a new home if it meets the requirements for being an exempt home. Each state has different requirements when it comes to Medicaid spend down. notify us For instance, the community spouse might fix the roof, get a new air conditioning system, new carpeting, new furniture, etc. Phone: 727-397-5571. For instance, in 2022, the asset limit in this situation for long-term care is $4,000 in Arizona, $6,000 in North Dakota, and $24,600 in New York. State Medical Assistance is a health care program operated by the Department of Social Services. The general rules for spend down planning are as follows: You cannot give money/assets away! To spend-down their excess assets, the couple purchases irrevocable funeral trusts in each of their names. Medicaid will not allow for a caregiver to be paid in advance for services not yet provided. While applicants are required to have under a certain amount in terms of assets and income, it is important to note that not all assets are counted towards Medicaid eligibility. One car may be considered an exempt asset when applying for Medicaid. Please (e) One automobile is excluded, regardless of value. May discharge to an assisted living and need help paying the assisted living bill of $3,000 - $5,000 per month? You need a medical card for August, but only have a $50 medical bill to use toward your spend-down. Medicare's coverage of nursing home care is quite limited. If an individual's income exceeds $217, spenddown eligibility may apply. So one should not hesitate to seek professional advice well in advance of when one thinks they might be close to becoming financially eligible for Medicaid. Most states will allow for a Medicaid applicant to make payments for caregiving services, especially when this helps keep the applicant at home or out of a more expensive nursing facility. For instance, some states do not count the non-applicant spouses IRAs, while some states do not count the applicant spouses or the non-applicant spouses IRAs. Institutional Billers: Use VALUE CODE 66 to report the spend-down amount on your claim. For example, in 2022, in Alabama, ones home is exempt up to a value of $636,000, and in Wisconsin, ones home may be valued up to $750,000. In order to qualify for Medicaid each month, you must first spend the excess $177 / month on medical bills. Coverage in your state may depend on waivers of federal rules. In this case, $42,000 must be spent down in order for them to be eligible for Medicaid services. Married couples, where only one spouse is applying for long term care Medicaid, have different asset limits. EXPENSES THAT CAN BE USED TO MEET/REDUCE SPEND DOWN: Medical expenses that meet the following criteria can be used to reduce/meet the spend down obligation: The client or a financially responsible relative received the service; The service is recognized under Montana State law as Medicaid payable; These guidelines define which assets are "Countable" assetsand which assets are "Non-countable" or "Exempt" and are thereby not used to calculate qualification for Nursing Home Medicaid benefits. This legislation requires the Department to consult with stakeholders who may recommend alternative Medical Assistance (MA) spenddown payment requirements and processes. The designated funds may be excluded regardless of whether the exclusion is needed to allow eligibility. Updates. When thinking about asset spend-down for Medicaid eligibility, it is extremely important to know which assets are considered countable and which ones are considered non-countable. With long-term care remaining costly, this community spouse resource allowance, or CSRA, protects the healthy spouse from financial hardship. Individuals in this profession have practical experience in asset spend-down and can assist you and / or your loved ones in appropriately spending down assets in order to qualify for Medicaid. of inaccuracies. Whats a premium, deductible, coinsurance, or copayment? We need to plan for the possibility that we will become unable to make our own medical decisions. These funds are often limited to $15,000. Transferring Assets to Qualify for Medicaid. Lakeland, FL 33801 Your state's Medicaid program will take into account individual state laws as well as your marital status, living arrangements, and other factors. There is a great deal of confusion regarding the spend down of assets for Medicaid qualification. Medicaid Asset Protection Planning" involves restructuring assets that are "Countable" into assets that are "Non-Countable" or "Exempt". Do Not Sell or Share My Personal Information. Rather, assets must either be converted to a "Non . Over the Income Cap? This means owning a home will not require you to spend down. What it is: Spenddown is the amount of medical expenses you must incur within a specified period of time to qualify for Medically Needy benefits. 2920 Drane Field Road 1-800-396-5145, NAELA News Oct/Nov/Dec 2016 I explained that, if she could purchase $4,000.00 or more worth of goods or services, she would be back under $2,000.00. The Kentucky Medicaid program provides medical assistance to individuals meeting income, resource and technical eligibility requirements. As of 2023, the maximum CSRA is $148,620, although this amount can be lower, depending on your state. Example 2 Michael and his spouse, Joann, are both in their 80s and are in poor health. Essentially, this is the value I as an Elder Care Lawyer who focuses on Medicaid planning bring to my clients. Learn more about our practice development tools for elder law attorneys. However, in general, you'll need to spend on out-of-pocket medical expenses, such as your deductible, copay or coinsurance. MAGI Medicaid eligibility is determined in one of the following four categories: 1. YOU simply don't want to spend the family assets on the nursing hom. Medicaid Spend-Down - New York Health Access 7500 Security Boulevard, Baltimore, MD 21244 . Assisted Living ALTCS Application Medicaid Eligibility Group Homes, Long Term Care Memory Care In Home Care Pet Friendly Senior Living, Copyright Senior Planning LC. For that reason, we have put together the following checklist to help people better understand the lawand where the money can legally be spent in a Medicaid spend down process. The information provided on this site is not legal advice, does not constitute a lawyer referral service, and no attorney-client or confidential relationship is or will be formed by use of the site. website belongs to an official government organization in the United States. When one cancels their policy or decreases the cash value of the policy, the extra cash value goes to the policyholder, and must be spent. The community spouse (i.e., the at-home spouse) may generally keep roughly one-half of the couples assets up to a maximum of about $117,000 (in 2014). Children under age 19; 2. Once again the intention is to have the community spouse get the types of things which are needed to keep the household running without major expenditures down the road. Some assets are considered exempt and possessing them does not prevent a person from receiving Medicaid. The income limit is $217 and resource limit is $2,000 for an individual. Married Couples with Only One Spouse Applying for MedicaidIn the case where only one spouse is applying for long term care Medicaid, the spouse who is applying for benefits is generally able to retain $2,000 in assets. Some states let you "spend down" the amount of your income that's above the state's Medicaid limit . Jacob Gottlieb, an Arizona native, earned a Bachelor of Science degree in Finance from Arizona State University. Who can get Medically Needy coverage? I help people who have too much (or will have too much) by way of income or assets legally and ethically qualify for Medicaid by protecting their assets in a Medicaid-compliant manner (in a way that does not trigger the five-year look back for Medicaid). Original Medicare Check your Medicare coverage options. Most states will allow for the pre-payment of certain funeral and burial expenses. Find out if you qualify for SSDI benefits. Pay Off DebtOne can pay off credit card debt, their mortgage loan, their automobile loan, etc. To alleviate this issue and receive Medicaid, there is a tactic called spending down. This tactic of spending down allows Medicaid applicants to spend from their income and assets until their assets reach an acceptable level and the applicant becomes eligible for Medicaid. There are ways to handle excess income or assets and still qualify for Medicaid long-term care, and programs that deliver care at home rather than in a nursing home. For example, if an applicant were to find out she was $1,000 above the Medicaid requirements and decided to give a $1,001 gift to a family member, she would not become immediately eligible for Medicaid. How do you convert "Assets Medicaid wants you to spend into Assets Medicaid ALLOWS YOU TO KEEP"? Pre-payment of utilities is normally not allowed, since no benefit has been provided in the form of future services, and the individual has the legal right to terminate a utility at any time. The medicaid recipient may be advised to spenddown their excess assets to remain Medicaid qualified; or. To be accepted into the program, some of the individual's income must be. Gifting is only appropriate as a Medicaid spend down if my client understands that they will be intentionally subjecting themselves to a period of disqualification from Medicaid. In addition to nursing home care, Medicaid may cover home care and some care in an assisted living facility. The funds may be commingled in the retroactive period. . Furthering the complexity is the fact that there are 50% states, 100% states, and 100% special rule states. As such, they can reduce a familys out-of-pocket care costs or reduce the hours they spend providing care themselves. As with the medically needy option, not all states allow QITs. Likewise, the applicant can purchase a new automobile if he or his spouse will drive it. Each state is different, however, so these examples are given for illustration purposes only. Since household goods and furnishings are ordinarily noncountable, purchase of those types of items should also be allowed. One misconception is that the only way to reduce the value of one's assets is to spend them on the Medicaid applicant's medical care. While the preceding factors are relatively simple to calculate, states also vary in the way they calculate the amount of countable assets a healthy spouse can keep. This is one of the biggest rules. How Medicaid's Money Follows the Person Program Aids Seniors, Protecting Spouses of Medicaid Applicants: 2023 Guidelines, Pros and Cons of a Medicaid Asset Protection Trust, Selling Your Life Insurance Policy to Help Cover Expenses, Your Will Can Protect Your Children With Disabilities. Please reference the Terms of Use and the Supplemental Terms for specific information related to your state. Cancel Life Insurance Policies with a Cash Value Over $1,500Since life insurance policies with a cash value of $1,500 or less are exempt, it makes sense to cancel insurance policies that have a cash value over $1,500. Sign up to get the latest information about your choice of CMS topics. With drug coverage,you'll never pay 100% of the cost for drugs covered by Medicare. Finally, keep in mind that while some of these spenddown strategies will not work as well for a single person qualifying for Medicaid, there are other strategies that can work equally well, no matter whether you are dealing with a single person or a married couple. Publication Name. Examples of these sorts of properties include any properties from which the applicant derives an income. Learn if your state is an income cap/categorically need state or a spend-down/medically needy state. ALL RIGHTS RESERVED. Certain assets can take applicants over the asset limit for Medicaid, requiring applicants to spend down until they meet the asset threshold. South Carolina allows the healthy spouse to keep up to 100% of $66,480, and Illinois allows up to $109,560. Copyright 2023 MH Sub I, LLC dba Nolo Self-help services may not be permitted in all states. The attorney listings on this site are paid attorney advertising. In other words, becoming "poor". If you or your loved one is over the asset limit for your state, that does not automatically mean that you will be denied Medicaid benefits. Find a Medicaid Planner / Determine Eligibility Status Its just a common way to refer to how one can get rid of excess assets in order to qualify for Medicaid. This does not hold true, however, in all cases of money owed. You are currently over the limit because you have $20,000 in savings. As the spouse applying for Medicaid in 2022, Grants asset limit is $130,000, and his wife, the healthy / non-applicant spouse, is able to keep up to $137,400 of their joint assets, for a total of $267,400. What Can You Legally Spend Money on in Order to Qualify for Medicaid? A pre-payment for services not yet provided will be treated as a gift, and will result in a period of Medicaid ineligibility. Purchase an AnnuityAnnuities are a way to convert non-exempt assets into a stream of income. You could be eligible for up to $3,345 per month In SSDI Benefits Check Eligibility We would have reviewed a number of other Medicaid spend down strategies. What Is Medicaid Spenddown, and Why Do People Need to Do It - GoodRx The Medical Assistance program pays for medical care and treatment the same as private health insurance. If done too soon, however, the debt repayment would only go one-half against the assets of the nursing home spouse and one-half against the assets of the community spouse. This includes real and personal property used in a trade or business; non-business income-producing property; and property used to produce goods or services essential to an individuals daily activities. What Is a Medicaid Spend Down? - ValuePenguin We have a number of ways to do this: some involve trusts, others caregiver contracts, there are even certain investments available that are Medicaid compliant. Plumbing repairs, home improvement projects, repairs to a roof, installation of a new roof, landscaping, and additions to a home are all allowable expenses for an exempt home. The number of different options and prices allow people in need of long term care to find the solution that works best for them. To be eligible for Medicaid long-term care, recipients must have limited incomes and no more than $2,000 (in most states). As of 2022, the following states are 100% states: Alaska, California, Colorado, Florida, Georgia, Hawaii, Illinois, Louisiana, Maine, Mississippi, South Carolina, Vermont, and Wyoming. Generally speaking, most states allow a single Medicaid applicant to retain up to $2,000 in countable assets. Similarly, for a married couple, the rules are even more complex. If steps aren't taken to protect the Medicaid recipient's house from the states attempts to recover benefits paid, the house may need to be sold. If you or your loved one is in a nursing home now or you are looking for ways to protect assets from the high cost of long-term care, please download a copy of our book Don't Lose Your Nest Egg to a Florida Nursing Home. Through the Inflation Reduction Act, President Biden is delivering on his promise to lower prescription drug costs, make health insurance more affordable, and make the economy work for working families. The $2,500 is not reduced by the value of excluded life insurance policies or irrevocable burial contracts. Therefore, he has spent-down the excess $8,000 in assets and is eligible for Medicaid. This portion is valued at 6% of the equity interest. As a couple, they have $280,000 in joint assets. For those who can afford it and who can qualify for coverage, long-term care insurance is the best alternative to Medicaid. Because those newly purchased assets would still be counted. To learn more about this option,click here. No information contained in this post should be construed as legal advice, nor is it intended to be a substitute for legal counsel on any subject matter. Generally, you must meet your state's rules for your income and resources, and other rules (like being a resident of the state). Spending Down Assets to Qualify for Medicaid - ElderLawAnswers

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