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Medicaid Coverage of Spouse's Nursing Home Expenses

Many seniors can't afford long-term health care, like nursing home care. Medicaid is a federal government program that provides health insurance for the poor and the elderly. It can help pay for nursing home care services for older adults. Given nursing home costs, paying for nursing home care would likely bankrupt most seniors. But Medicaid will pay for nursing home care if the applicant meets the eligibility requirements.

Medicaid and Nursing Home Care

Medicaid will pay for nursing home costs as long as the recipient meets the Medicaid eligibility criteria. You must need the care given in a nursing home, and the state Medicaid agency has certified the nursing home. Although this seems relatively straightforward, this approach can get complicated for married seniors with assets. Many seniors risk losing their life savings if they need nursing home care. Medicaid often only pays after they deplete their assets.

Before the passage of the Medicare Catastrophic Coverage Act in 1988, elderly couples faced impoverishment if one spouse got care in a nursing home. This was often catastrophic for the community spouse or the spouse who was not in a nursing home. The institutionalized spouse is the spouse who is in the nursing home.

Congress passed the Medicare Catastrophic Coverage Act 1988 to protect the community spouse from impoverishment. The Act provides spousal impoverishment protection for legally married couples when one spouse needs nursing home care.

Spousal Impoverishment Protection

Under federal spousal impoverishment protection, the community spouse can keep some of the couple's income and countable assets if the applicant spouse uses Medicaid for long-term care.

Medicaid Eligibility

Generally, you can't meet Medicaid eligibility if you have more than a few thousand dollars in countable assets. For married couples, Medicaid looks at the couple's countable assets as of the first day the institutionalized spouse enters long-term care. Countable assets include the following:

  • Cash
  • Savings accounts
  • Annuity
  • Stocks

The Medicaid program looks at any assets the Medicaid recipient can convert to cash to pay for their medical care.

Exempt Assets

Medicaid rules exempt certain assets, including the following:

  • Marital home
  • Irrevocable trusts
  • Funeral or burial trusts
  • Life insurance policies under a given amount set by Medicaid

Asset Assessment

At the start of the qualifying process, Medicaid looks at the couple's assets to determine the community for the community spouse's possible contribution. The snapshot reflects their financial status during the Medicaid applicant's first continuous (minimum 30 days) institutionalization in a nursing facility or hospital.

The asset assessment will determine the community spouse's contribution, if any, to their spouse's medical care.

Income Eligibility

While Medicaid doesn't consider the community spouse's income when qualifying a Medicaid recipient, some states do. In these states, if the community spouse's monthly income exceeds the state's limit, the state may ask the community spouse to contribute to their spouse's medical care.

SSI and Spousal Impoverishment Standards

The Centers for Medicare and Medicaid (CMS) annually publishes the SSI (Social Security Income) and Spousal Impoverishment standards. These standards provide monetary guidelines to ensure the financial well-being of a community spouse residing in the marital home. This document outlines the following:

  • SSI resource standards
  • Minimum monthly maintenance needs allowance (MMMNA)
  • Maximum monthly maintenance needs allowance
  • Community spouse monthly housing allowance
  • Minimum and maximum community spouse resource allowance (CSRA)
  • Minimum and maximum house equity limits

Minimum Maintenance Needs Allowance

The MMMNA is the amount of income set by federal law that the community spouse can receive from the institutionalized spouse's income. Some states allow the community spouse to keep a shelter allowance for the following:

  • Rent or mortgage
  • Taxes
  • Insurance
  • Utilities

Medicaid Planning

Many couples opt for Medicaid planning to protect their assets ahead of any possible institutionalization or increased medical expenses. These people use legal avenues like a trust to protect their assets. Without such protection, the state Medicaid office could try to recover care costs from the nursing home resident's estate.

Get Help

Medicaid rules for coverage of a spouse's nursing home expenses are relatively complex. If you or a family member needs help understanding Medicaid's rules, an elder law attorney can help. They are experts in elder care law and can give sound legal advice. Speak to an elder care attorney today.

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