Updated Medicaid Figures for 2020

The Michigan Department of Health and Human Services (MDHHS) ordinarily releases updated figures for Medicaid qualification. Typically these updates are released in late summer and most importantly, they reflect the cost of living increases that all of us experience. For Medicaid recipients, the increases allow additional amounts to be used to pay for funerals or to allow a community spouse to retain additional amounts of their spouse’s income.

The maximum spousal share is the maximum amount of countable assets that the at-home spouse is allowed to keep. For 2019, the amount was $126,420. For 2020, the maximum spousal share was increased in January to $128,640. This means that if a married couple has $257,280 or more in countable assets, the at-home spouse is able to keep $128,640. There is also a minimum spousal share which has been increased for 2020 to $25,728. In other words, if a married couple has $51,456 or less in countable assets, the at-home spouse will be able to keep at least $25,728.

The Medicaid rules also allow for a Minimum Monthly Maintenance Needs Allowance. This is the minimum amount of income that the at-home spouse is allowed. For 2019, the minimum allowance that the at-home spouse was allowed was $2113.75. Beginning July 1, 2020, the Minimum Monthly Maintenance Needs Allowance was increased to $2155.00.

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. On July 1, 2020, the Maximum Monthly Maintenance Needs Allowance for the community spouse was increased to $3216.00.

Beginning June 1, 2020, the limit on irrevocable funeral contracts was increased to $13,160. Also, the amount a person can assign for funeral expenses under a life insurance policy was increased to $11,160.

Finally, MDHHS will apply a penalty to any gifts made within 5 years of the filing of a Medicaid application. In 2019, the penalty divisor was $8469. Beginning in January 2020, the penalty divisor is $8618. For example, suppose Betsy Smith gives a total of $10,000 to her church over a 5 year period. If she should later require nursing home care, she would be penalized from receiving Medicaid benefits for 1.18 months (10,000/8618 = 1.16).

As always, stay tuned for further Medicaid updates as they occur.

Elder Law Today is written by Brett A. Howell, Certified Elder Law Attorney. The newsletter is published as a service of The Elder and Estate Planning Law Firm, P.L.L.C. This information is for general informational purposes only and does not constitute legal advice. For a consultation to address specific questions, please call (810) 953-3846.