By Jami Scott, Paralegal and Medicaid/VA Specialist
Elder Law Associates PA
Last month, the Florida Department of Children and Families (DCF) raised the Spousal Impoverishment Standards used to compute the income allowances for “community spouses” of institutionalized individuals who are enrolled in Supplemental Security Income (SSI) programs, including the Institutional Care Program (ICP) and the Home and Community Based Services (HCBS) Waiver program. Community spouses are those who are well and living at home (i.e., in the community) and not in a long-term care facility or institutional setting. The institutionalized or “applicant spouse” is the one who is receiving Medicaid or other government funded long-term care in a nursing home or services through the HCBS Waiver program.
New Standards for 2020-2021
DCF’s announcement on June 19, 2020, indicated the new Minimum Monthly Maintenance Needs Allowance (MMMNA) will be $2,155 (up from $2,114 in 2019), and the Excess Shelter Standard (ESS) will be $647 (up from $634 in 2019), effective July 1, 2020. The new standards apply to the following coverage groups: HCBS-iBudget, Program of All-Inclusive Care for the Elderly (PACE) and the Statewide Medicaid Managed Care, Long-Term Care Waiver (SMMC-LTC). The maximum monthly community spouse income allowance has not changed and is expected to remain at $3,216 for the rest of 2020, with a change tentatively scheduled to occur in January 2021.
What is spousal impoverishment, you ask? Nursing home care in the South Florida area ranges from $8,000 to $11,000 per month or more, which can rapidly deplete an elderly couple’s assets, leaving those who are still living at home with little to no income or savings to take care of themselves.
To prevent this “spousal impoverishment” from happening, the government, under the Medicaid Spousal Impoverishment provision, allows for a certain amount of the couple’s combined resources and income belonging to the institutionalized spouse (the MMMNA) to be transferred to the community spouse and protected for the community spouse’s use, enabling the community spouse to continue to live independently without causing undue hardship.
How Medicaid Works
As you may know, Medicaid was designed for people with little income and few resources, so there is an income and asset requirement to be eligible for this benefit. For Medicaid purposes, a married couple’s assets are considered jointly owned. To minimize the assets of the applicant, and to allow eligibility for Medicaid benefits, a certain amount of assets can be transferred to the community spouse without penalty. The Community Spouse Resource Allowance (CRSA) is the amount of assets that the community spouse is allowed to keep. This amount is adjusted annually. Certain liquid assets are counted toward the CSRA. This includes, but is not limited to, bank accounts, certificates of deposit, stocks, bonds and vacation properties.
Some other assets are considered exempt and are not factored into the CSRA, including the couple’s main home (if the community spouse lives there and it is worth less than the threshold – currently at $595,000), household furniture and appliances, clothing, one automobile, irrevocable trusts that cannot be changed or canceled, and life insurance policies under a face value amount of $2,500.
On the day the applicant spouse qualifies for Medicaid, the government adds up all the countable assets of the couple. The figure is divided by two, and the community spouse can retain half of the assets up to the maximum resource standard (for 2020, this amount in Florida is $128,640). The gross income of the applicant spouse must be less than $2,349 per month, while the community spouse’s income is not limited. If all this sounds complicated, that’s because it is. But not to worry, the Medicaid Specialists at Elder Law Associates PA understand all the ins and outs of Medicaid and are here to help.
We Can Help You Navigate Medicaid
We work with couples and their families every day on Medicaid planning and asset preservation planning, employing various strategies to help the applicant spouse become Medicaid eligible, and the community spouse keep all that he or she is entitled. With Medicaid planning, as with everything we do, we strive to give families peace of mind. For more information, please give us a call today at 1-800-ELDERLAW or (561) 750-3850 or contact us through our website to set up a consultation.