What happens if your spouse needs care? You not only need to consider his/her costs, but also the income you’ll need to live on. The law governing this situation is the Spousal Impoverishment provision of the Medicare Catastrophic Act of 1988. And it’s just as complicated as it sounds!
Basically, the couple’s assets are divided in half. The spouse at home is the “community spouse,” and the one in care the “institutionalized spouse.” A few states allow the community spouse to keep the maximum of (up to) $109,560. However, most states just divide the assets in two. The institutionalized spouse can keep $2,000, and the amount the community spouse can keep is the Community Spousal Resource Allowance. (CSRA).
The community spouse is allowed a minimum income, called the Minimum Monthly Maintenance Needs Allowance (MMMNA), currently set by the federal government at $1,750 per month. So, if a female community spouse has $500 in Social Security income and her disabled husband has Social Security of $1,250, all his income would be diverted to his Community Spouse to get her income to the MMMNA of $1,750.
However, if the community spouse earns $2,000 a month between her Social Security and pension, the other spouse’s $1,250 would go to the nursing home as a co-pay. Confused yet???
Planning alternatives do exist. But you won’t find them without the assistance of an Elder Law attorney.
Your friends may tell you, “Just Give Away $13,000 Per Year to Each Child.” Unless they’re Elder Law experts, however, don’t listen!
In Medicaid’s eyes, even small gifts can be combined to establish a long period of ineligibility. And that’s before the state even looks at your assets!
Medicaid considers a gift to be a transfer. And if these transfers were made during the previous five years, the state would expect the family to return the money to pay for care.
You may think you’ve dealt with frustrating bureaucracies before. But – trust me – until you deal with Medicaid, you ain’t seen nothin’ yet!
You don’t have to deal with Medicaid alone, though. That’s why we’re here.
At The Law Offices of Alice Reiter Feld & Associates, we practice Elder Law – and only Elder Law. We’ve been practicing it for 33 years. And we’ve walked thousands of South Florida families through the Elder Law Journey… not only with Medicaid, but also with comprehensive estate planning, wills, trusts, powers of attorney, asset preservation, long-term care planning, and the VA.
We deal with Medicaid every day.
And we’re just a phone call away.
More On The Medicaid Journey: Planning For A Disabled Spouse