Medicaid is a health care assistance program created for the benefit of low-income individuals. To be eligible and considered “medically needy,” your resources must be less than the maximum resource amount allowed in your state.
How are assets and income determined?
Medicaid has established two categories of assets to be considered in evaluating an individual’s eligibility for Medicaid benefits — countable assets and exempt assets. Countable assets are assets that must be used for the individual’s care prior to the person being placed on Medicaid. Exempt assets are exempt from being used for the person’s care, but may be subject to recovery after the individual’s death.
Countable assets for single and married individuals
A single individual is allowed to keep $2000 in cash and investments, as well as his or her home, if the plan is to return to it. A single person who lives in a nursing home can retain $40 per month of income for personal use, with the rest of the income being applied to the cost of medical care.
Countable assets are different for individuals who are married. A well spouse, who lives at home, is allowed to keep the family home, a car, personal property and an amount depending on the state in cash and investments, plus a portion of the couple’s monthly income.
The limits may change each year
As with most things, the income limits and eligibility requirements are subject to change each year. So, it is important to contact your county Medicaid office to determine the current requirements. Before applying for Medicaid, you should consult with your Medicaid planning attorney, for assistance in converting your countable assets to exempt assets and taking necessary steps to protect assets from recovery.
Strategies for preserving assets
There are strategies that can be used to protect as much of your personal assets as legally possible. Generally, the goal is to protect your countable assets by spending them on non-countable or exempt assets. Some examples include:
- prepaying funeral expenses
- paying off a mortgage
- making repairs to a home
- replacing an old automobile
- updating home furnishings
- paying for more care at home
- buying a new home
If you have questions regarding Medicaid spend down, or any other Medicaid planning needs, please contact Sexton, Bailey Attorneys, PA online or by calling us at (479) 443-0062.
- Are You Sure You Should Use a Will? - July 10, 2021
- Estate Planning and Family Heirlooms - July 1, 2021
- Five Key Facts About Medicaid Planning - June 27, 2021
Leave a Reply