Who is eligible?
Someone may qualify in a nursing home or Home and Community Based Services (HCBS) waiver program is the person is in need of long term care. “Long-term” care means that the patient individual will remain in a nursing home or hospital for 31 consecutive days or longer. For HCBS waiver participants, long term care means the individual needs waiver services for 31 days or longer. A death that occurs prior to meeting the 31-consecutive day requirement is the exception because Medicaid will consider that the individual would have needed long term care services had the individual lived. In addition:
- A person must be age 65 or older, blind or disabled (unable to work).
- The medical necessity of the placement must be certified by the attending physician.
- Persons must apply for, and accept, all benefits which he or she may be entitled, such as VA benefits, retirement or disability benefits, etc. Persons who do not accept these benefits may lose their Medicaid eligibility.
Income and Resources
The income that is counted is only the income of the person in the nursing home or HCBS waiver or their share of jointly owned income. Persons with income above the institutional limit may be able to qualify under an “Income Trust.” An Income Trust for someone in a nursing facility requires income to be payable to the nursing facility and to the Division of Medicaid (DOM), depending on the amount of income involved. If monthly income exceeds the private pay rate that the nursing facility charges for a 31-day month, it is not possible to qualify for Medicaid under an Income Trust. For a HCBS participant, an Income Trust requires all income over the limit to be paid to the Division of Medicaid up to the total amount expended by DOM. The institutional limit is subject to change each year. Refer to the Long Term Care brochure for the current institutional limit.
Individuals may have total resources of up to $4,000. Resources mean those assets, including real and personal property, that a person owns that help him or her meet his or her basic needs. Some resources are not counted in the $4,000 limit. They include:
- Home property: one home may be excluded if it is the person’s primary place of residence.
- Income-producing property: This property is not counted towards the limit if it produces a net annual return of 6% of the equity value to the beneficiary. Promissory notes and annuities must be determined actuarially sound, i.e., the return must be equal to the life expectancy of the beneficiary.
- Automobiles: up to two vehicles may be excluded.
- Household goods: these items are totally excluded.
- Personal property: personal property may be excluded if the equity value is $5,000 or less.
- Life insurance: the cash value of whole life insurance policies is excluded if the face value of all whole life insurance policies on each person is $10,000 or less. The value of term life insurance is not countable regardless of value.
- Burial plots and burial funds: burial spaces intended for family members are not counted in the $4,000 limit. Money saved for funeral expenses up to $6,000 is not counted.
- Transferred assets: persons who plan to apply for Medicaid may not transfer assets within 60 months prior to application. For assets transferred into a trust, the review (look-back) period is 60 months.
Assessment of Resources
Persons who have entered long-term care or who are applying for HCBS waiver services, and who have a spouse living in the community or in the same home for a HCBS participant, are entitled to an “assessment for resources” upon request. This means a representative from a Medicaid regional office will advise the couple in writing of how their combined resources will be counted.
The spousal resource limit is subject to change each year. Refer to the Long Term Care brochure for the current spousal limit.
A request for an assessment may be made by either member of a couple or a representative for either spouse. An assessment can be completed when one spouse is in long-term care and the couple provide verification of all countable resources to the representative from the Medicaid Regional Office completing the assessment.
An application for Medicaid may be filed rather than requesting an assessment. If the couple chooses to make an application, their combined countable resources will be evaluated allowing the “community spouse” the maximum in spousal resources. The spouse who is entering the long-term care facility or HCBS waiver is allowed $4,000 as his or her share of resources to qualify for Medicaid. The community spouse will be allowed up to 90 days to make any needed changes in ownership of assets between spouses.
Medicaid Income – for nursing home only
After a person has been determined eligible for Medicaid, he or she must pay toward the cost of their care, if income allows. This payment, which is made to the long-term care facility, is referred to as Medicaid income. Medicaid income is the individual’s total income less the following allowable deductions:
- A personal needs allowance (PNA) of $44 per month. Individuals active in a work therapy program with earnings are allowed additional deductions based on their earnings. Veterans and surviving spouses of veterans who receive a $90 VA pension have a $90 PNA.
- A monthly allowance for the community spouse, less the spouse’s own income, which is based on the institutionalized person’s actual income. The maximum monthly allowance is subject to change each year and can be found in the Long Term Care brochure. In order for this amount to be deducted, it must be available to the community spouse.
- A monthly allowance for the other dependent family members is based on the dependent’s own income.
- Deductions for health insurance premium(s) paid by the individual in the nursing facility.
- Deductions for medically necessary care, services and items incurred by the individual in the nursing facility, within specified limits, that are not subject to payment by a third party.
Individuals eligible in a HCBS waiver program do not pay “Medicaid income.” However, if a HCBS individual is eligible under an Income Trust, income over the institutional limit must be paid in order to participate in the HCBS waiver.
Persons who apply for Medicaid may be eligible to receive benefits for up to three (3) months prior to their month of application. To qualify, the applicant must meet all eligibility requirements during the three (3) months and have received medical services in each of the three (3) previous months.
Effective July 1, 1994, Medicaid will seek recovery from the estate of deceased Medicaid recipients who are age 55 or older and in a nursing facility, or enrolled in a Home and Community Based Services Waiver Program at the time of death. Recovery will be made from any real or personal property in the estate of the recipient up to the value of payments made by Medicaid for nursing facility, hospital and drug services. Estate recovery will not apply to recipients who have a surviving spouse or dependent or disabled child.