I have been helping Texan for many years figure out how to spend down assets for medicaid eligibility so that they can pay for nursing home care. Here is an overview of the process.
In order to be eligible for Medicaid benefits a nursing home resident may have no more than $2,000 in “countable” assets (the figure may be somewhat higher in some states). Note that Medicaid is a state-run program, so the rules are somewhat different in each state, although there are federal guidelines.
The spouse of a nursing home resident–called the “community spouse” — is limited to one half of the couple’s joint assets up to $117,240 (in 2014) in “countable” assets. This figure changes each year to reflect inflation. Called the “community spouse resource allowance,” this is the most that a state may allow a community spouse to retain without a hearing or a court order. The least that a state may allow a community spouse to retain is $23,448 (in 2014).
Example: If a couple has $100,000 in countable assets on the date the applicant enters a nursing home, he or she will be eligible for Medicaid once the couple’s assets have been reduced to a combined figure of $52,000 — $2,000 for the applicant and $50,000 for the community spouse.
Some states, however, are more generous toward the community spouse. In these states, the community spouse may keep up to $117,240 (in 2014), regardless of whether or not this represents half the couple’s assets. For example, if the couple had $100,000 in countable assets on the “snapshot” date, the community spouse could keep the entire amount, instead of being limited to half.
All assets are counted against these limits unless the assets fall within the short list of “non countable” assets. These include the following:
- Personal possessions, such as clothing, furniture, and jewelry
- One motor vehicle, regardless of value, as long as it is used for transportation of the applicant or a household member. The value of an additional automobile may be excluded if needed for health or self-support reasons (check your state’s rules).
- The applicant’s principal residence, provided it is in the same state in which the individual is applying for coverage. In some states, the home will not be considered a countable asset for Medicaid eligibility purposes as long as the nursing home resident intends to return home; in other states, the nursing home resident must prove a likelihood of returning home. Under the Deficit Reduction Act of 2005 (DRA), principal residences may be deemed non countable only to the extent their equity is less than $543,000, with the states having the option of raising this limit to $814,000 (in 2014). In all states and under the DRA, the house may be kept with no equity limit if the Medicaid applicant’s spouse or another dependent relative lives there
- Prepaid funeral plans and a small amount of life insurance
- Assets that are considered “inaccessible” for one reason or another
My firm has been helping Texas families for many years navigate the issues surrounding getting Medicaid benefits to pay for a family member’s nursing home care. A big question is how to spend down assets for medicaid eligibility. We do not charge for the initial consultation so please contact me today if there are any questions you have about what needs to be done to get Medicaid benefits to help pay for nursing home care. The phone numbers to call are 1-866-KNOW.LAW (866-566-9529) (TOLL FREE) or 972-772-6100 or you can email me at firstname.lastname@example.org.
We protect Texans and their rights. One Texan at a time. You can count on us!