Getting Ready
to Be On Medicaid in
How Should You
“Spend Down”?
(revised
***OK, before we begin, a few reminders. This page may talk about
"you" and what "you" should do, because it's written informally,
but of course I don't know you or your particular situation. For advice
tailored to you SPECIFICALLY, you have to consult your own lawyer, and give
that lawyer all pertinent facts. If I told you, in particular, what to
do, I'd be giving you legal advice. That's a no-no on a website.
So, this is NOT meant to be legal advice, just an informal summary of the law
and what many people (not necessarily you) would find useful to do when faced
with this situation. If you want legal advice, consult your own
lawyer. And please don't consult me (that is, send me your info and ask
for help) without letting me check first about whether my firm would have a
conflict of interest in helping you. In the meantime, use this page at
your own risk. Thanks for understanding. And now, on to the
talk.***
1. First, what does it MEAN to
“spend down” assets?
º To qualify for Title 19
(Medicaid) for LONG-TERM
·
If unmarried: $1,600 plus certain “Exempt
Assets”
·
If married with spouse living at home: $1,600 plus assets for
your spouse (half your combined total up to $104,400, but at least $20,880)2 – plus “Exempt
Assets.” (The "combined total" is determined as of the 1st
day of a continuous 30-day period of institutionalization -- so don't spend
down before that date or your "half" will shrink.)
º If you have
more than this, you do not qualify. The Department of Social Services,
which administers Medicaid in
º Suppose you
have not $1,600, but $51,600. You have $50,000 too much. You have to
“spend down” to $1,600 before you will be eligible.
2. How should you “Spend Down”
assets if you are not married?
º MEDICARE
SUPPLEMENTAL INSURANCE can still be purchased and cover you even if you are in
a nursing home. This can be vital to
cover the co-pays for days 21 - 100 of the nursing home stay which might be $10,000+
otherwise. CAUTION:
º FUNERAL
ARRANGEMENTS. First, you may want to buy an irrevocable funeral contract so
that your family is not burdened with that expense after you are gone.
The maximum is $5,400, although you do not have to spend that much if you don't
want to. If you want your remains to be buried, you may purchase a burial
plot if you do not own one. If you are married you may buy burial plots
for both of you. As of
º
º
º CHECK YOUR
FEET, SKIN, EARS.... Title XIX covers the basics. You do NOT have
your choice of doctor and you do not get everything done that can be
done. The State may only pay for a crummy $400 hearing aid. NOW IS
THE TIME to attend to any problems that the State may not find important: toe
problems; skin problems; breathing problems; getting the best hearing aid/wheel
chair/voice adapter/ventilator money can buy.
º
º MAKE ANY
EXEMPT TRANSFERS. While many gifts can cause problems for Medicaid
eligibility, some do not. These include:
·
Transfer of your home, or anything else, to a child
receiving Social Security Disability or SSI benefits. Consult an elder law
attorney or other knowledgeable attorney if you plan to transfer anything
besides your home to a disabled person.
·
Transfer of your home to a sibling who lived with you for the prior
year and who owns an interest in your home (name is on the deed).
·
Transfer of your home in certain other situations to a child who
cared for you for 2 years and lived with you. Consult an elder law
attorney on how to document this for the State.
"Transfers"
or gifts can cause BIG PROBLEMS if you don't follow the rules EXACTLY.
CONSULT AN ELDER LAW ATTORNEY and read my article on this subject.
º
º PAY IN
ADVANCE FOR HELP WITH THE MEDICAID APPLICATION. If your financial affairs
and plans are very simple, you may not need help. In that case, a friend
or family member, or you, can complete the paperwork and deal with the State's
questions. If you, your family or friends are not "paper
people" and might have trouble, or can't be relied upon to respond quickly
to the State's follow-up questions, or if you are married, OR IF YOU HAVE MADE
ANY TRANSFERS, consult
an elder law attorney. IT IS BETTER TO PAY
FOR THIS UP-FRONT WITH YOUR OWN MONEY,
º PAY IN
ADVANCE FOR "PERSONAL SERVICES." If you do not have close
family you can rely upon, you may want to set up a contract with a friend
or care provider who can attend care conferences about you, run errands for
you, visit you regularly, etc. Consult an attorney and don't try this at home.
3. How should you “Spend Down”
assets if you
In addition
to the ways described above, you can:
º FIRST,
º PUT THE
MONEY IN THE FAMILY HOME. Your home is an exempt asset as
long as your husband or wife (or minor or disabled child) is living
there. Pay off the mortgage (unless you are trying to protect
funds for your spouse, in which case check with your lawyer). Install the
vinyl siding; get a new roof and furnace; buy the replacement windows; add a
new carpet; put in the new kitchen your wife always wanted. She can
always borrow against the house later, or even sell it.
º PUT THE
MONEY IN THE FAMILY CAR. If you are married, you may want to spend the
money by investing in your car, which is an exempt asset. Trade in
that 1980 Chevvy for a 2008 Prius!
This summary was provided as
general information, NOT as legal advice, by
Attorney Lisa Nachmias Davis
Phone
1. The rules are not identical when it comes
to Medicaid "in the community" that you receive on account of poverty.
In that situation there is a "spend-down" of excess income, which is
the correct use of the term "spend-down." This article
addresses Medicaid for the elderly or disabled for long-term care received at
home or in a nursing home. Income is also relevant, but that's
another article.
2.These numbers change annually.
Numbers listed are effective as of this writing,