The odds that you, or your spouse, will need long-term care during your retirement years increases with each passing year. If you are already looking at the need for nursing home care for a spouse, you are also probably looking at the cost of that care – and if you live in the State of New York you can expect the cost to be exceptionally high. Like almost half of all seniors, you will likely turn to Medicaid for help paying the expenses your spouse will incur; however, you may be concerned about the eligibility requirements for Medicaid. Specifically, the resources and income limits may concern you. Where does it leave you if you reduce your estates and income to the level required for your spouse to qualify for Medicaid? Because the eligibility guidelines and procedures can be complicated, it is in your best interest to consult with a New York Medicaid attorney before applying for benefits; however, it may also be helpful to have a general understanding of the New York Medicaid Eligibility rules and how they impact a community spouse.
Qualifying for Medicaid – The Income and Asset Limits
Although Medicaid will cover nursing home expenses, you must first qualify for benefits. To qualify, you must have income and assets, or “countable resources” that fall below the program limits – and those limits are very low. Although the State of New York makes allowances for the high cost of living in the state, it is still easy for an applicant to exceed the income and/or asset limit.
What Happens If You Are Over the Limit?
If the value of your assets exceeds the program limit you will be expected to rely on those assets for a period of time before Medicaid will approve you for benefits. The “waiting period” during which you will be ineligible for benefits is calculated using a complicated formula that takes into account the value of your assets and the average cost of long-term care in your area. The bottom line, however, is that if the value of your assets exceeds the program limit you will likely lose a significant portion of those assets paying for nursing home care before Medicaid starts helping. Transferring assets in anticipation of the need to qualify for benefits won’t help either because Medicaid uses a five year “look-back” rule that effectively discounts any assets transfers made during the five-year period prior to your application and imputes the value of the assets back into your estate.
How Is the Community Spouse’s Income Treated?
Fortunately, the income of the community spouse is not counted in determining the Medicaid applicant’s eligibility. Only the applicant’s income is used to determine eligibility for Medicaid; however, if the spouse’s income exceeds a certain limit the applicant may have to contribute to the cost of care. Conversely, if the applicant is the spouse with all of the income, the community spouse will not be left impoverished. The community spouse may keep up to the “Minimum Monthly Maintenance Needs Allowance” (MMMNA) which, in the State of New York is set at $2,980.50 for 2016.
Can a Community Spouse Keep Any of the Couple’s Assets?
The other good news is that a community spouse may also be able to keep some of the couple’s resources, or assets. As a general rule, a community spouse may keep one-half of the couple’s total “countable” resources up to a maximum of $119,220 in 2016. There is also a minimum resources allowance set at $74,820.00 in the State of New York for 2016. The resources allowance also helps ensure that a community spouse is not left impoverished as a result of the need for a spouse to qualify for Medicaid benefits.
Given the complexity of the Medicaid eligibility rules, and the fact that the rules and limits are subject to change, it is always best to consult an experienced New York Medicaid attorney as soon as you realize the need for benefits if you failed to include Medicaid planning in your overall estate plan early on in your life.
For more information, please join us for an upcoming free seminar. If you have additional questions or concerns about the New York Medicaid eligibility guidelines, contact the experienced New York Medicaid attorneys at the Law Offices of Kobrick & Moccia by calling 800-295-1917 to schedule your appointment.