Medicaid will only grant nursing home benefits to applicants with a low amount of countable assets. Since the allowable limit is so low, most people will need to "spend down" their assets before they qualify for coverage. Since only certain spending will be allowed without incurring a penalty, it’s best to do your Medicaid planning with our elder law attorneys.
Can I Spend Money Without Risking Medicaid Approval?
A Medicaid applicant may transfer or spend assets in any way they want. However, any amount given away or spent on goods at less than market value will result in a period of ineligibility.
That said, Medicaid rules do allow applicants to spend money on certain things without incurring a penalty. To qualify, the purchase has to benefit the applicant or improve their quality of life, such as:
- Settling debts. Applicants can use their extra funds to pay off the mortgage on their homes, pay off a car loan, or settle credit card debts. Depending on the value of your assets, you could completely pay off a debt or make a large partial payment.
- Repairing a home. If either spouse is going to continue living in the family home, you may spend your overage on upgrades to the house. This can include putting on a new roof, widening doorways or building a ramp to accommodate a wheelchair, or installing rails near toilets and showers.
- Buying a new home. Your primary residence may be an exempt asset, so it may be possible to purchase a new home instead of making repairs.
- Prepaying funeral expenses. You may wish to pay ahead for funeral goods and services for you and your spouse before you go into care.
- Repairing or replacing a vehicle. If the healthy spouse regularly uses a vehicle, it may be a good time to get an extensive tune-up or buy a newer model.
- Buying reasonable personal effects. Some household goods or personal comfort items may be purchased, such as new clothes, a new phone or tablet, or furniture and electronics for the home.
- Paying medical bills. Money spent on healthcare may be exempt, so now is a good time to schedule any appointments that may not be covered by insurance (such as dentist visits or vision appointments).
- Investing in medical equipment. You may purchase medical items that aren't covered by Medicare or Medicaid, such as a sleep apnea machine, cane, wheelchair, rising chair, or medical alert device.
- Paying for reasonable home care. You may compensate anyone who provides regular or occasional care services, even if family members are providing the care.
Let Our Elder Law Attorneys Take the Worry Out of Applying for Benefits
The attorneys at Landskind & Ricaforte Law Group, P.C. can help you with the complicated calculations required for Medicaid eligibility. Contact us today.