Medicaid Eligibility Rules
Many older Americans live with the fear that they will end up in a nursing home and lose not only their independence but their entire life’s assets. Of course it depends on the location and level of care, but nursing homes can cost between $35,000 and $140,000 per year. Many seniors have little choice but to pay for the care they receive from a nursing home or similar facility with their savings until they have nothing left. Once the majority of the assets are gone, Medicaid will pick up the cost of the nursing home. While there are certain advantages to this way of doing things—you are more likely to be in a higher quality facility and can postpone the welfare bureaucracy which comes with applying to Medicaid—the obvious disadvantage is that you lose everything you have likely spent your lifetime accruing.
Estate Planning Makes Sense
This problem can be largely circumvented through working with an experienced elder care attorney who can guide you through the steps of careful estate planning. Each situation will be unique due to the financial and familial situations of the individual. Ideally you want to work with a professional who is highly experienced in Florida Nursing Home Medicaid in order to preserve the maximum amount of your assets as is legally allowable. Qualifying for Medicaid can be complex and full of stumbling blocks making it all the more necessary to have proper legal guidance in order to simplify the process and obtain maximum nursing home benefits.
Rules for Medicaid Eligibility
- First and foremost the person applying for benefits must be an American citizen or a resident alien as well as a resident of the state of Florida.
- The applicant must be 65 or older and have a physical or cognitive impairment to such a degree that placement in a nursing home is required. The medical necessity for being placed in a nursing home or comparable facility must be certified by the applicant’s primary physician.
Income Requirements for Florida Nursing Home Medicaid
- The applicant’s regular monthly income (gross) cannot be more than $2,022 (this figure is set to increase to $2,094) as of January 1, 2012.
- The applicant is allowed to have $2,000 in assets other than those assets which Medicaid considers to be either exempt or countable. The assets must be below this limit for at least one day during each month the application approval is pending.
- Should the applicant’s monthly income exceed the limit, a qualified income trust which is comprised only of the applicant’s income may need to be established in order for qualification.
Different Types of Assets Considered by Medicaid
Assets Considered “Countable” are any assets which are accessible to the Medicaid applicant or the well spouse.
Assets Considered “Non-available” are those which produce an income such as rental properties. Once the applicant is deceased if these assets were in the applicant’s name only, Florida Medicaid Recovery Lien will attach. Assets which generate a regular amount of money will be considered assets for eligibility determination rather than income.
Exempt Assets are those assets which are not considered when eligibility for nursing home Medicaid is being considered. The following assets are deemed exempt by the program:
- Homestead—One’s home is considered an exempted asset, however those applicants who have significant home equity–exceeding $506,000—will not be considered for nursing home benefits. Equity in a home is calculated through determining what the present value of the homestead is and subtracting the debts which is currently owed against it. The amount which a home could practically be predicted to bring given its location comprises the current market value.
- Vehicle—Medicaid allows the applicant for Nursing Home Medicaid to have one vehicle, regardless of how much it is worth or how old it is. An additional vehicle which is over seven years old—other than antique, customized or luxury vehicles—may also be considered exempt.
- Personal Property—most personal and home items are considered exempt other than such items as valuable jewelry, collections or artwork.
- Life Insurance—the applicant may own one or more life insurance policies with a face value which, when totaled, does not exceed $2,500. Medicaid considers any applicant-owned term life insurance policy to be exempt.
- Life Insurance of Spouse—the “well” spouse may also own one or more life insurance policies so long as the total face value does not exceed $2,500, and the same exemptions for term insurance apply as those of the applicant.
- Burial Plans—both the applicant and the well spouse may possess a burial arrangement in an amount up to $2,500.
- IRAs, 401ks, 403bs—Such types of retirement plans are considered to be a type of hybridized plan under Medicaid law since they may be counted as income or could be considered as an asset. If the person applying for Medicaid or their spouse takes money from the retirement plan on a regular basis, it will be considered income; if the plan is not used as a form of monthly income, it will be treated as an asset.
If you or a loved one have looked over the eligibility rules for nursing home Medicaid qualification and don’t feel you will qualify, don’t give up. A knowledgeable Medicaid attorney may be able to help you become qualified.
Let us help you determine the best Medicaid Planning strategy that will work for your particular situation. We offer a FREE initial consultation that will answer many of the additional questions not covered here on our web site. Call us in Jacksonville at (904) 900-2750 or toll free anywhere in Florida at 1-866-306-3550, or you can fill in and submit the form below.