Michigan’s Department of Human Services (DHS) is the administrative branch responsible for administering and managing the state’s Medicaid program. This branch of government is responsible for setting the Medicaid eligibility criteria each year. Recently, the DHS released its financial eligibility criteria.
The new community spouse resource allowance is a minimum of $21,912.00 and a maximum of $109,560.00. This number is important for married persons with a spouse in the nursing home. It determines how much in cash and otherwise non-exempt assets the spouse living in the community will have to spend down before qualifying for Medicaid.
The community spouse income allowance, which is the income that the community spouse can keep each month and not have to pay to the nursing home has been increased from a minimum of $1,750.00 to $2,739.00. The new utility allowance (which provides additional income protection for the community spouse above the minimum protected amount) is $550.00 per month. However, it is important to note that these numbers do not adjust until April of this year.
An important change to note is the update to the divestment rules. If you recall, from my previous post, divestment is a gift by an individual prior to applying for Medicaid benefits. Any gift made is divided by the “penalty divisor” to calculate the length of time the individual will be ineligible to receive benefits. The new penalty divisor is $6,362.00. Accordingly, for every $6,362.00 gifted by a nursing home patient, within the look back period, the state will withhold nursing home care for 1 month. As a result, if an applicant gives away $63,620.00 during 2009 and needs nursing home care, the state will impose a penalty of 10 months.
For many seniors, these numbers may be discouraging: particularly those related to the community spouse. DHS will require an unadvised senior to spend down to ½ of the family’s total assets with a maximum of $109,560.00 before qualifying for Medicaid. Furthermore, the income allowance is very seldom any higher than $1,750.00 based on cost of living expenses alone.
Despite these limits, it is still possible to save more than the normal allowances. Only a well versed elder law attorney can assist you with preservation of your assets and provide you or your family with the care that you deserve.
If you need assistance with Medicaid or nursing home planning, please contact our office.