By: Kevin R. Albaum
Clark, Campbell, Lancaster & Munson, P.A.
A person’s transition to a skilled nursing facility (a/k/a “Nursing Home”) is often a very difficult time for a family. Not only is the person’s physical or mental health often declining but the person and/or their family is often burdened with figuring out how to pay for the facility. Health insurance coverage often will pay for the first few days or months at the Nursing Home but that eventually stops and the cost of a Nursing Home once health insurance is no longer paying often gets exorbitant even for the middle-upper class (the monthly cost for a private pay resident at many Nursing Homes can often exceed $10,000.00 per month). This results in residents no longer being able to afford the Nursing Home and having only two (2) options to pay for their care: (1) qualify for Medicaid Nursing Home coverage or (2) pay the private pay rate any way possible by selling off all assets, impoverishing the spouse at home (the “Community Spouse”) or getting financial help from their children. Many decide to pursue the first option.
In order to qualify for Medicaid Nursing Home coverage in Florida, an applicant must pass a three (3) part test that looks at a person’s assets, income, and health at the time they file the Medicaid application. The scope of this article is just to discuss the basics of the asset and income eligibility tests for Medicaid Nursing Home coverage in Florida in 2019.
Income: Effective January 1, 2019, an individual can have a maximum of $2,313.00 per month in income (before deductions) in order to be eligible for Medicaid Nursing Home coverage. However, if an individual’s income is above that figure, then proper legal planning to create a qualified income trust will be often utilized in order able to make the individual eligible. However, timing is very important because if the income trust is not set up properly and funded properly, an individual will still not be eligible for Medicaid. There is a common misconception that a Community Spouse’s income being too high will limit the applicant spouse from obtaining Medicaid eligibility, however, a Community Spouse’s income can be unlimited and it does not impact a Medicaid applicant’s eligibility for Medicaid benefits.
Assets: Effective January 1, 2019, an individual can have a maximum $2,000.00 of countable assets and be eligible for Medicaid Nursing Home coverage. However, if an individual’s countable assets are above that threshold there are often a multitude of legal planning options available in order for the individual to become eligible for Medicaid Nursing Home coverage. There are two (2) types of asset classes to consider when applying for Medicaid Nursing Home coverage: Countable Assets (assets that impact Medicaid asset eligibility) and “Non-Countable Assets” (assets that are not calculated into Medicaid asset eligibility). Some Non-Countable Assets are as follows: homestead property up to $585,000.00 in value; one automobile of unlimited value; a prepaid burial contract with a nursing home (in most circumstances) and term life insurance without a cash value. Most other items such as bank accounts, investment accounts, life insurance with a cash value, CDs, annuities, etc. are considered Countable Assets. There is also a common misconception that a Community Spouse must also not have any assets in order for their spouse in the Nursing Home to be eligible for Medicaid benefits. Effective January 1, 2019, a Community Spouse can have a maximum of $126,420.00 of countable assets without impacting their spouse’s Medicaid eligibility.
Obtaining Medicaid eligibility and understanding the income and asset tests can be incredibly complex to those who are new to the subject, therefore, it is highly recommended that a qualified elder law attorney assists you in obtaining Medicaid financial eligibility before you file a Medicaid application.
Kevin Albaum is an attorney in the Elder Law Practice of the law firm Clark, Campbell, Lancaster & Munson, P.A. Questions can be submitted online to firstname.lastname@example.org.