Question: What are the Medicaid Resource and Income levels? I was told they change every year and differ from County to County. Can you explain?
Answer: With the new year and the cost of living adjustment from social security, the State Department of Health adjusts the maximum amount of income and assets a Medicaid recipient can have in her name. As of January 1, 2018, a single person is eligible for Medicaid if she has assets totaling less than $15,150, up from $14,850 last year, and up to $842 in income (for home care Medicaid applicants), up from $825.
Your Assets and Medicaid Eligibility
In addition to these allowable funds, there are certain assets one can own over and above $15,150 that are considered exempt for eligibility purposes, as well as extra income amounts that can be disregarded. There are also tools that can be used to allow the Medicaid recipient to retain the use of all of their income while receiving care at home through the Medicaid program, even when their income exceeds $842 per month.
Planning for Medicaid Spend-Down
If an individual is in need of home care or nursing home care and has income or resources above the State levels, she will have to spend down or make certain allowable transfers for the Medicaid program to cover some or all of the cost of care. This is where proper estate and Medicaid planning are important for families who foresee a need for assistance in the home or in a nursing home.
Medicaid Eligibility and the Look-Back Period
For those looking for homecare Medicaid coverage, also known as Community Medicaid, the applicant will be eligible the month after her assets are transferred out of her name, putting her at the proper income and resource levels. For nursing home applicants, Medicaid is authorized to look back at all transactions made by the applicant, and her spouse, for 5 years prior to application. Any transfer of assets made within this time that are below fair market value will incur a penalty period. The applicant will be denied Medicaid coverage until the penalty period has ended. To calculate the penalty period, Medicaid will divide the dollar amount of the assets transferred by the regional nursing home rate for the applicant’s county. The resulting number will be the penalty period, meaning the number of months that must pass before Medicaid will begin to pay for nursing home care for that applicant. While the maximum income and asset levels are the same across the state, the regional rate used to determine the penalty period differs based on the region in which the applicant lives.
For example, Jane is a Suffolk County resident who is in a nursing home and applying for Chronic Medicaid. Within the last 5 years, Jane gave her children $26,106. The regional nursing home rate for Suffolk County for 2018 is $13,053.00. Jane will therefore incur a penalty period of 2 months ($26,106 divided by $13,053). For 2 months, Jane will have to pay for the nursing home out-of-pocket. These transfers could cause a person in need of care to deplete her own personal resources, leaving little of her estate, if any, to pass on to her loved ones.
Estate Planning to Make the Most of Medicaid
There are plenty of opportunities to plan for both community and nursing home Medicaid, even if you do not have the benefit of waiting five full years. New York State rewards prudent estate planning which allows the protection of assets so individuals can utilize these government programs.