In past issues of the Elder Law Today, we have explained how the Medicaid laws work for a married couple when one of them needs nursing home care. The Spousal Impoverishment Provisions of the law make it clear that the Medicaid program does not intend to impoverish one spouse because the other needs care in a nursing home. Much of this is based on the spend down of assets and what levels must be met before someone qualifies.
The law says that for a married couple, the at-home spouse is entitled to keep a minimum amount of money with no spend down. The minimum spousal share effective January 1st is $23,448. In addition, the nursing home spouse may keep $2000. In other words, for a couple with $25,448 in countable assets (plus the $2000 amount allotted to the nursing home spouse) there will be no spend down.
The maximum spousal share has also been increased for 2014. This is the maximum amount of countable assets that the at-home spouse is allowed to keep. For 2013, the amount was $115,920. For 2014, the maximum spousal share has been increased to $117,240. This means that if the couple has $234,480 or more in countable assets, the at-home spouse will now be able to keep $117,240.
The Medicaid laws also allow for a Minimum Monthly Maintenance Needs Allowance. This is the minimum amount of income that the at-home spouse is allowed. For 2013, the minimum allowance that the at-home spouse was permitted was $1898. For 2014, the Minimum Monthly Maintenance Needs Allowance has been increased to $1,966.
There is also a Maximum Monthly Maintenance Needs Allowance. This is the amount of income that the community spouse is allowed to keep if his or her home related expenses are high enough. Let’s say there is a community spouse whose home is mortgaged requiring a monthly payment of $1,000. This at-home spouse would be entitled to more than the $1966 minimum. In 2014, the new Maximum Monthly Maintenance Needs Allowance for the community spouse is $2931.
In 2013, the limit on irrevocable funeral contracts was $11,970. For 2014, the limit on irrevocable funeral contracts has been increased to $12,130. Also, the amount a person can assign for funeral expenses under a life insurance policy is to $10,130.
In light of the Medicaid rules regarding gifting, it is also very important to know the new penalty amount that the Department of Human Services will apply to any gifts made within 5 years of the filing of a Medicaid application. This includes birthday gifts, Christmas gifts, gifts to any church or charity, etc. In 2013, the penalty divisor was $7631. In 2014, the penalty divisor is now $7867. For an example of how this would apply, suppose Betsy Smith gives a total of $10,000 to the First United Methodist Church over a 5 year period, if she should require nursing home care, she would be penalized from receiving Medicaid benefits for 1.27 months (10,000 divided by 7867 = 1.27).