The Maryland program called Medical Assistance provides financial support for long-term and nursing home care for seniors over age 65. In order to financially qualify for Medicaid, applicants must meet both income and asset requirements.
In many cases, a knowledgeable elder law attorney can assist a senior in meeting the eligibility criteria, even if income or assets appear initially to be over the guidelines. Rockville attorney Henry Nash provides these important Medical planning services for clients.
Establishing eligibility for long-term care benefits requires meeting specific requirements for both income and assets. The rules are extremely complex. But even if you think you exceed the limits, strategies may be available that can bring you into compliance with the limitations.
For Medicaid purposes, any income of an applicant counts, including wages, retirement and pension payments, SSI and SSDI income, IRA withdrawals, and stock dividends. If only one spouse of a married couple applies for nursing home Medical Assistance, the income of the non-applicant spouse does not count for eligibility purposes.
Current guidelines provide that an applicant’s income cannot exceed the cost of nursing home care. In cases where income appears to exceed the allowable limit, there are strategies that may be available through Medicaid planning that enable the applicant to qualify.
Under a spousal impoverishment rule, the applicant may be able to transfer income to a non-applicant spouse to ensure the spouse has sufficient financial resources to live on. A non-applicant spouse may be entitled to a Minimum Monthly Maintenance Needs Allowance (MMMNA).
If your income appears to exceed the eligibility limit, you should discuss your circumstances with a knowledgeable Medicaid planning attorney. You may be able to take steps that will make you eligible.
Asset eligibility is based on the applicant’s countable assets. Non-countable (exempt) assets include the applicant’s home (under specific circumstances and with an equity interest up to $603,000 for 2021, which does not apply if the community spouse lives in the home), personal belongings and household furnishings (any value), and a motor vehicle. In addition, an applicant’s spouse may retain a Community Spouse Resource Allowance (CRSA) of up to one-half of the countable resources, with limitations.
The countable asset limitation for an unmarried applicant in 2021 is $2500. For married couples who both apply, the limit is $6,000 ($3,000 for each spouse). If only one spouse applies, the asset limit is $2500 for the applicant and $130,380 for the non-applicant spouse (including the CRSA).
In many cases, Medicaid allows use of special strategies and tools that spend down assets to enable the applicant to meet the asset guidelines. Assistance from a Medicaid planning professional is absolutely essential for individuals who may be able to take advantage of these special approaches.
Medical Assistance rules allow you to spend down assets and income on nursing home care or in other legally permissible ways in order to qualify under the guidelines. However, the way you accomplish the spend-down must meet specific requirements.
The following discussion summarizes the primary strategies that may help an applicant meet eligibility criteria. However, what is available for you depends entirely on your individual circumstances. If you are over either (or both) guidelines, you should talk with a qualified Medicaid planning attorney, who may be able help you qualify for benefits faster and keep more of your money, while getting the government-provided benefits for your nursing home care.
Maryland has a law and policy that encourages use of a supplemental needs trust, also called a special needs trust or SNT. This specific type of trust may enable you to spend down income and assets and become eligible for long-term care assistance by putting money into a trust to be used for your benefit. An SNT actually can help you enhance your quality of life, in addition to protecting your financial assets while qualifying for Medicaid nursing home or long-term care benefits.
There is no limit to the amount an applicant can put into an SNT. For example, an applicant who is over the asset limit by $500,000 can put that amount in an SNT and qualify for benefits as of the first day of the following month.
While there is no limit on how much can be put into an SNT, a supplemental needs trust must comply with specific legal requirements. The language of the trust is also subject to approval by the Office of the Attorney General. Assistance from an attorney experienced in setting up SNTs in conjunction with Medicare eligibility is absolutely critical before you attempt to establish an SNT to qualify for nursing home benefits.
You can read more about SNTs in our special blog post about them: What Is the Role of a Special Needs Trust or Supplemental Needs Trust in Maryland Medicaid Planning?
In addition to supplemental needs trusts, other strategies may be available to help you qualify for Medicaid benefits for nursing home care. For married applicants, one option that allows a spouse to keep more money is purchase of very specific types of Medicaid-compliant annuities.
You may also be able to transfer funds to a blind or disabled child either outright or in a separate SNT. In limited circumstances, there may be other ways to transfer money to a child or grandchild, but you should never try to make these transfers without advice from a knowledgeable Medicaid lawyer. Specifically, you should not rely on a nursing home representative or your local social services office to assist in this regard. If you make transfers without advice of a qualified Medicaid planning lawyer, you could jeopardize your eligibility status.
Attorney Henry Nash has extensive experience helping elders and their families work through the complex laws and concerns inherent in all types of elder law matters, including Medicaid planning and estate planning.
At The Law Office of Henry Nash, we work with clients in Rockville, throughout Montgomery County, and elsewhere in Maryland. We also assist out-of-state clients who have loved ones residing in the state. If you have any questions or concerns about any issues relating to elder law, we welcome you to call us at (301) 998-6111 or contact us through our online form.