Dear Attorney Tully: I am terrified. My husband and I are probably younger seniors than you see in your practice, but my husband is very sick and in a nursing home for long-term care. I’ve been told I have to spend down almost all of our savings, including my IRA, in order for him to qualify for Medicaid. Is this true?
Answer: Not necessarily. Please be careful to whom you are listening. It could cost you thousands and even hundreds of thousands of dollars. There are specific rules that Congress has passed that protect the community (healthy) spouse if the other spouse goes into a nursing home.
The Medicaid law provides special protections for the spouse of a nursing home resident to make sure he/she has the minimum support needed to continue to live in the community.
The so-called “spousal protections” work this way: If the Medicaid applicant is married, the countable assets of both the community spouse and the institutionalized spouse are totaled as of the date of “institutionalization,” the day on which the ill spouse enters either a hospital or a long-term care facility in which he or she then stays for at least 30 days. This is sometimes called the “snapshot” date because Medicaid is taking a picture of the couple’s assets as of this date.
In general, the community spouse may keep one half of the couple’s total “countable” assets up to a maximum of $126,420. Called the “community spouse protected amount,” this is the most that Connecticut may allow a community spouse to retain. The amount protected could be substantially more than $126,420. The least amount that a state may allow a community spouse to retain is $25,284. There are legal strategies that you can implement to protect possibly everything that you own.
Example: If a couple has $100,000 in countable assets on the date the applicant enters a nursing home, he or she will be eligible for Medicaid once the couple’s assets have been reduced to a combined figure of $51,600-$1,600 for the applicant and $50,000 for the community spouse. Please note that in most cases, you can keep much more than this with proper planning.
Some states, however, are more generous toward the community spouse. In these states, the community spouse may keep up to $126,420, regardless of whether or not this represents half the couple’s assets. Unfortunately, Connecticut is not one of those states. Therefore, you must protect yourself by consulting with an experienced elder law attorney so you can protect the maximum allowed by law. Some spouses are so concerned about the health of the ill spouse that they fail to protect their own financial future by spending down more than the law requires.
Attorney Daniel O. Tully is a partner in the law firm of Kilbourne & Tully, P.C., members of the National Academy of Elder Law Attorneys Inc., with offices at 120 Laurel St., Bristol (860) 583-1341.