Tip: Don’t’ impoverish your spouse if you go on Medicaid.
You may have heard that you can only have $2,000.00 and still qualify for Medicaid to pay for long-term care. While this is true for individuals applying for Medicaid, if the person applying for Medicaid is married, Federal law allows the spouse remaining at home to retain a significant amount of the couple’s assets so that he or she doesn’t become impoverished when the other spouse goes into
a care facility.
If a person needs but can’t pay for the cost of long-term care, in addition to filing a Medicaid application for the spouse going into a facility, a couple should file a Community Spouse Resource Allowance (CRSA), which allows the stay-at-home spouse to retain certain assets. For the following discussion on the CRSA, I am designating the stay-at-home spouse the wife and the Medicaid applicant, the spouse going into a facility, the husband.
Medicaid categorizes resources as exempt assets and countable assets. Exempt
assets include the following:
• Primary residence
• Personal household goods
• One vehicle per spouse
• Prepaid funeral
• IRAs if the RMD is being taken
Exempt assets are not counted toward the $2,000 asset limit to qualify for Medicaid. Countable assets include pretty much everything else including the following:
• Cash
• Savings and checking accounts
• Cash value of insurance policies
The total value of the countable assets of an individual cannot exceed the $2,000 asset limit.
In 2024, in addition to the exempt assets, the wife can retain 50% of the couple’s countable assets, up to a maximum of $154,140. If the non-applicant’s share of the assets is under $30,828, 100% of the assets, up to $30,828 can be retained by the wife.
To be eligible for Medicaid, the husband’s share of the countable assets cannot exceed $2,000. If he has more than $2,000, he cannot give money away (except to a disabled child); however, he can use the money to pay off the couple’s debts, pay off their mortgage, make repairs to their home, upgrade their car, prepay their funerals, pay legal expenses and pay for his care.
One final point, now that the couple’s assets have been transferred to the wife, if by chance she dies before the husband, all the wife’s assets will go back to him making him ineligible for Medicaid. To avoid this, the wife, may make a Will that includes a Special Needs’ Trust for her husband. Then if the wife dies before the husband, the assets do not go to him but are held in a Trust to be used for his benefit. In this way he remains eligible for Medicaid.
View our “Senior’s Guide to a Well-Planned Future” on our website! Packer Elder Care Law – with you for life!
Tom Packer is an Elder Law Attorney serving all Southeast Idaho. As part of his law practice, Tom offers Life Care Planning to deal with the challenges created by long-term illness, disability and incapacity. If you have a question about a Senior’s legal, financial or healthcare needs, please call us.
September 2024