Medicaid is a government program that pays for medical services, including nursing home care. To get Medicaid payment for nursing home care you must be financially eligible, you must need the care given in a nursing home, and the home itself must be certified by the state Medicaid agency. Medicaid pays a large portion of our country's nursing-home bills -- over 40 percent -- but only pays when almost all your assets have been depleted.
But what about when just one spouse needs to be in a home? Will all of the couple's income and assets have to be used up before Medicaid coverage of a spouse's nursing home expenses kick in?
To help with this problem, Congress passed the Medicare Catastrophic Coverage Act in 1988. Provisions of the Act provide spousal impoverishment protection for legally married couples when one spouse is in a nursing home and the other spouse isn't. The person in the nursing home is referred to as the “institutionalized spouse,” and the other spouse is the “community spouse.”
Spousal Impoverishment Protection Law
The purpose of this federal spousal impoverishment protection law is to allow the community spouse to keep some of the couple's income and assets while still qualifying the institutionalized spouse for Medicaid. These provisions help ensure that this situation won't occur and that community spouses are able to live out their lives with independence and dignity.
Under these spousal impoverishment provisions, a certain amount of the couple's combined resources is protected for the spouse living in the community. Depending on how much of their own income the community spouse actually has, a certain amount of income belonging to the spouse in the institution can also be set aside for the community spouse's use.
Spousal Protection: Income Limits
The following are the minimum and maximum amounts of resources and income that can be protected for a spouse in the community in 2018 (keep in mind that these amounts regularly change):
A snapshot of the couple's assets is taken in order to determine the community spouse's share. The snapshot reflects the couple's assets at the time of the Medicaid applicant's first continuous (minimum 30 days) institutionalization (in a nursing facility or hospital).
Medicaid and Resource Assessment
When an institutionalized spouse is applying for Medicaid, the couple will need to complete a resource assessment tool based upon the resources (assets) owned at the snapshot date and an application for Medicaid (which asks for information about current resources).
The community spouse's share is calculated from the resource assessment tool. The institutionalized spouse's eligibility is determined from the application. Assets of a married couple are generally considered to be jointly-owned no matter in whose name they have been placed.
Minimum Maintenance Needs Allowance
The community spouse is also entitled to a Minimum Monthly Maintenance Needs Allowance, which may come in whole or in part from the income of the institutionalized spouse. This is triggered if the community spouse's income is below a spousal allowance figure. This figure is set by the state under federal guidelines. Some states may also permit the community spouse to keep a shelter allowance for rent, mortgage, taxes, insurance, and utilities.
Confused About Medicaid Spousal Coverage? An Attorney Can Help
As you can see, the rules surrounding Medicaid coverage of a spouse's nursing home expenses are quite complex; and yet, the stakes are usually quite high. If you have doubts about your options under the law, you may need legal expertise. Get help today by contacting an experienced, local health care attorney.