Question: My husband may require care in a Nursing facility. I was considering applying for Medicaid but I have heard that we could lose everything if we accept assistance through the Medicaid program. Is this correct?
Answer: No, however this is a common misconception. Medicaid is a means tested program and accordingly applicants must meet certain income and asset requirements. Rest assured, despite these requirements, there are protections for spouses who remain in the community. In 2019, applicants for Chronic Medicaid (this is the program which will assist in paying for Nursing Home Care) may have up to $15,450.00 in resources in order to be eligible. In addition, the applicant may have qualified (retirement) accounts in any amount assuming distributions are being taken on a monthly basis based on the life expectancy table used in the specific county you are applying in. Finally, an irrevocable pre-arranged burial account in any amount is an exempt asset. Federal guidelines permit community spouses to retain up to $126,420.00 in assets plus a primary residence with a maximum value of $878,000.00. Assuming your husband has assets which exceed the allowance; these assets can be transferred to you to bring him below the Medicaid threshold amount. However, New York’s spousal refusal provisions provide even more protection in that a community spouse can elect to sign a document which allows them to retain assets in any amount, including assets which were previously in the name of the spouse that requires care in a nursing facility.
Income is treated a bit differently. An applicant for Chronic Medicaid may only retain income in the amount of $50.00 per month, everything in excess of that must be contributed to the cost of his care. Where there is a community spouse that spouse is entitled to keep the greater of: (1) all of her income, or (2) her income plus enough of her spouse’s income to bring her to a total income of $3,160.50.
Another option you may want to consider is the Community Medicaid program. This is the Medicaid program which will pay for care in your home. Under this model, the asset rules stay the same, however the income rules differ. For Community Medicaid the general rule for income is that the applicant spouse may retain a monthly income of $859.00 plus a disregard of $20 bringing the total to $879.00. However, under this program any excess income can be directed to a Pooled Income Trust for the benefit of the Medicaid applicant and the monies deposited into that trust can be used to pay the household expenses of the Medicaid applicant.