People often need Medicaid after a health crisis or sudden change in circumstances, so spouses might not enter long-term care at the same time. Fortunately, Medicaid eligibility rules allow a healthy spouse to keep some of their income and property while the other spouse receives Medicaid benefits. However, there are limits to the amount and type of property the healthy spouse may retain.
Can I Keep the House If My Spouse Needs Medicaid?
Medicaid laws include a special set of rules called spousal protections that ensure a healthy spouse has enough income and assets to live on. If one spouse enters a nursing home, the healthy spouse (also called the community spouse) can continue to live in the family home.
That said, the family home isn’t completely protected. If the community spouse sells the house during the Medicaid beneficiary’s lifetime, the nursing home resident will no longer be eligible for Medicaid due to the added resources from the sale. In addition, the state Medicaid agency may put a lien on the house in an attempt to recover care costs after the nursing home resident has passed away.
Can I Keep My Own Income?
While some (or all) of the Medicaid applicant’s income may go to the nursing home, the community spouse’s income is usually not counted in determining a spouse’s Medicaid eligibility. However, if a community spouse earns a significant amount, they may be required to contribute to the costs of a spouse’s care.
A person’s income must be below a certain threshold in order to qualify for benefits, so many applicants have to “spend down” their excess earnings before Medicaid will cover their nursing home costs. Some of this excess income may be transferred to the community spouse if they need additional financial support.
Both state and federal laws set limits on the amount of a spouse’s income that a community spouse may keep, called the Minimum Monthly Maintenance Needs Allowance (MMMNA). The federal minimum is currently $2,115 while the maximum is $3,259.50, but the exact dollar amount changes each year. In New York, up to $3,216 in monthly income is exempt from calculations when determining whether the applicant spouse is eligible for Medicaid.
Will I Have to Give Up Shared Assets?
Under federal Medicaid laws, a community spouse is allowed to keep a certain portion of the couple's marital assets or resources. The amount of resources that the community spouse may keep (called the Community Spouse Resource Allowance) changes from state to state and is adjusted for inflation every few years. In 2021, the federal maximum CSRA is $130,380, while the federal minimum is $26,076.
In New York, the spouse entering long-term care may currently keep assets up to $15,900 in their own name. As of 2021, the community spouse may have up to half of the couple's total combined assets up to $130,380, or $74,820 (whichever is greater). This includes resources in the community spouse's name only, resources in the Medicaid spouse’s name that exceed $15,900, and any of the couple’s joint resources.
Let Our Elder Law Attorneys Find the Best Way to Protect Your Assets
New York laws provide several ways for well spouses to protect their own income and assets while a loved one is in the nursing home. For example, spouses with significant assets may file a spousal refusal document with the Department of Social Services (DSS) if they don’t wish to contribute their resources to the care of an ill spouse.
If you want to keep the family home safe, you may be able to create an asset protection trust to hold ownership of the home, shielding it from Medicaid collection. Depending on your circumstances, you may also need to establish a guardianship or financial power of attorney over an ailing partner.
Whatever your needs are, our New York Medicaid planning attorneys at Landskind & Ricaforte Law Group, P.C. can help protect your home, livelihood, and financial future. If you or your spouse needs long-term care, contact us today through our online form to get help.