Elder Law Frequently Asked Questions
What are the financial eligibility requirements for Medicaid to pay for nursing home care?
Presently, a Medicaid applicant is allowed to keep $14,550.00 in non-exempt resources and may set up an irrevocable funeral trust to prepay burial and funeral expenses. Under certain circumstances, a person’s home may be retained. The nursing home patient is allowed to keep furniture, personal effects and other tangible property actually used, and an allowance out of income of $50.00 per month for personal needs.
If the applicant is married, what additional financial resources can be retained by the spouse?
If the applicant is married to a spouse who lives in the community, the community spouse is entitled to keep considerably more property and income than a single person may keep. The spouse may retain the home, furniture, automobile, and the tangible personal property used in connection with the home. The spouse also may retain cash, securities, and other resources with a value set by law. Presently, that amount is $74,820.00, or one-half of the couple’s resources as of the date of institutionalization up to a maximum of $117,240.00. Out of income, the community spouse may keep an inflation indexed amount, which is $35,172.00 per year ($2,931.00 per month) for 2014, plus 75% of any income of his/her own in excess of that amount. Unless a Medicaid applicant establishes at a fair hearing that assets in excess of the resource allowance are required to produce the minimum income allowance, assets of both spouses above these levels must be applied to the long term care expense and will be considered available resources of the patient, even though the assets may be titled to the community spouse’s name.
Additionally, if a community spouse has resources and/or income in excess of the allowable limits, he/she has the legal right to refuse (in writing) to use these excess resources and income to pay for the applicant spouse’s nursing home care. If a community spouse exercises such a “spousal refusal”, Medicaid must evaluate the applicant’s eligibility without taking the community spouse’s resources and income into consideration. In such cases, however, the Medicaid agency has the right to bring an action against the community spouse at a later date seeking reimbursement for amounts Medicaid actually pays for the applicant spouse’s care.
Can long term care insurance pay for nursing home care?
Private long term care insurance is available for custodial long term care expenses. Care must be taken in examining the terms of coverage. For example, must there be hospitalization prior to coverage? What is the waiting period? What is the maximum daily benefit? Is home health care coverage included? Is respite care covered? Is Alzheimer’s disease covered? Is the policy guaranteed renewable? Is there a waiver of the premium upon disability?
Due to the numerous consideration that go into a deciding whether or not to purchase long term care insurance, it is recommended that an insurance professional should be consulted before making a purchase.
Can I just give everything away and qualify for Medicaid to pay for nursing home care?
No. The available resources of a Medicaid applicant are verified and calculated. Bank statements, income tax returns, and other documentation concerning a Medicaid applicant’s resources must be provided to the Medicaid social worker at the time the application is made. Resources must be spent down before Medicaid will pay for long term care. Spent down generally means spent on health care, but if done properly, available resources also may be converted to exempt resources by using them to pay off home mortgages, make home improvements, or purchase exempt property.
Gifts made within the 60 months preceding the Medicaid application are presumed to have been made in order to qualify for Medicaid. Therefore, such gifts result in a period of ineligibility for institutional Medicaid. This is true regardless of whether the gift was made by the patient or his spouse. There is no period of ineligibility in New York, however, for gifts made before this 60 month “look back period.”
The length of ineligibility depends upon the size of the gift and the average cost of care for a private patient in a nursing home as established by law (which may be quite different than the actual cost). The established average cost in Central New York in 2013 is $8,432.00 per month. Thus, a gift of $20,000.00 in 2013 would cause a disqualification period of 2.37 months ($20,000.00 divided by $8,432.00 = 2.37). The disqualification period does not begin until the month in which the donor is admitted to a nursing home and is otherwise financially eligible for Medicaid.
Special gifting exemptions apply to the transfer of a home to a minor, blind, or disabled child or to a sibling who has an ownership interest and one year or more residence in the property immediately preceding the patient’s institutionalization. A son or daughter who lives in the home as a caregiver for at least two years before institutionalization also may be the recipient of an exempt transfer of the home.
Is there anything I can do to protect my assets from having to be spent on nursing home care?
Yes. There are currently options available to help protect your assets. The options vary though based on each person’s individual situation. The individual’s marital status, assets, income and anticipated length of time before needing skilled nursing home care all are important factors in evaluating the available options. The available options can include things such as creating an Irrevocable Trust, transferring title to real property and retaining life use of the property, and entering into a carefully planned arrangement with family members that involves a loan and a gift.
A loved one is in a nursing home - is it too late to do anything to protect assets?
No. Although your options will be more limited, there are still likely options available to help protect some assets.
Will Medicaid pay for me to receive care at home?
Although Medicaid does not cover 24/7 care at home for someone who needs skilled nursing care, there are Medicaid programs which will pay for some care at home. These programs can be quite effective when the individual needing care has other family members available who can provide some care to supplement the limited care paid for by Medicaid.
What should I do if I would like to meet with an attorney to learn more about options for protecting assets from being spent on nursing home care?
If you would like to meet with us to discuss your options, please either contact us directly, or download and print one of our Confidential Asset Protection Planning Worksheets, complete it as best you can and return it to us. We will contact you to schedule an appointment after receiving your completed Worksheet.
What should I do if I think a loved one needs to apply for Medicaid to pay for nursing home care soon?
If a loved one is either in a nursing home, or you are in the process of finding a nursing home for a loved one, the nursing home staff will discuss payment options with you, including Medicaid. Although most nursing homes will provide some assistance with the process of applying for Medicaid for residents who are financially eligible for the Medicaid program, they typically are not able to provide potentially cost-saving advice regarding Medicaid eligibility and the application process itself. It is thus important to talk to a knowledgable attorney about your individual situation to obtain personalized advice.
If you would like to meet with us to discuss an anticipated Medicaid application for a loved one, please contact us. We can provide as much or as little assistance with the Medicaid application process as each client desires.