Mary and Jim were high school sweethearts who have lived together in Flint, Michigan for their entire adult lives. Recently, Jim, who has Alzheimer’s, wandered away from home. The police found him sitting on the curb, talking incoherently. After taking Jim to the hospital, the doctor told Mary that she would need to place Jim in a nursing home. Because they grew up during the depression, Mary and Jim tried to save money each month. Their assets are as follows:
Savings account: $35,000
Money Market account: $17,000
Checking account: $3,000
Residence (no mortgage): $100,000
Jim gets a Social Security check for $1,100 each month; Mary’s check is $550. With nursing home costs at over $7,500 a month, Mary is worried that their entire life savings will gone in less than two years.
To apply for Medicaid, she will have to go through the Department of Human Services (DHS). If she does things strictly according to the way the DHS tells her, she will only be able to keep about half of her assets plus she will be entitled to a minimum monthly income to pay her expenses. But, the results can actually be better than that.
With the proper advice from someone familiar with the Medicaid rules, Mary will be able to avoid the spend-down and keep everything she and Jim have worked so hard for.
This is possible because the law does not intend to impoverish one spouse because the other requires nursing home care. In this example, knowledge of the Medicaid rules is critical in resolving Mary’s dilemma.