We define a Medicaid crisis as a situation where an individual has either been admitted to a nursing home or is about to be placed in a nursing home, and they have been told that they have too much money or too many assets to qualify for Medicaid. The family is dealing with long-term health care costs and the only source to pay those expenses seems to be the family’s life savings. It is not unusual for well-intentioned individuals to give a family incorrect advice regarding their ability to qualify for Medicaid.
The team at Mayhone Elder Law knows the Mississippi Medicaid rules and can help a loved one qualify for Medicaid. We can also utilize the rules to preserve the maximum amount of money or resources permissible. Many of our clients have been told by nursing home intake staff, social workers, Medicaid workers, and others that they do not qualify for Medicaid. Nonetheless, using legal and ethical means, we regularly save our clients substantial amounts of their life savings. We can create a plan to ensure that you never run out of money so you never run out of options. It is never too late to call us, unless all of your assets have been spent.
2017 Medicaid Reference Amounts
Community Spouse Resource Allowance: $120,900
This is the amount of countable resources the spouse at home can have. This does not include certain exclusions.
Resource Allowance for an Individual: $4,000
This is the total amount of countable resources that a person in a nursing home can have in his or her name and still qualify for Medicaid long term care benefits. This does not include certain exclusions.
Monthly Maintenance Needs Allowance: $3,022.50
If the community spouse is earning less than $2,931.00, some of the institutionalized individual’s income may be diverted to the community spouse to bring their total gross monthly income up to this maximum amount.
Income Cap Amount: $2,205
Any income earned over this amount will require an Income Trust. What this means is that all monies of the institutionalized individual will be paid to the nursing home as a cost of care share for the nursing home resident if the gross income is less than the cost of care and any allowable expenses.
Monthly Personal Needs Allowance: $44 ($90 qualifying Veterans and surviving spouses)
This is the maximum a person in a nursing home is able to keep each month from his or her income. There are certain other allowable expenses. Certain veterans and surviving spouses may be able to qualify for a higher allowance.
Divestment Penalty Divisor: $5,700 (2011-14) / $5,920 (2014-15) / $6,250 (2015-16) / $6,405 (2016-present)
This is the divisor Division of Medicaid will use the determine the penalty period for transfers made during the previous 60 months prior to applying for benefits. To calculate penalty, total all transfers made during the look-back period and divide by the correct divisor. The answer is the penalty period in months, during which the applicant will be eligible for all services except payment to the nursing home.
Things to remember
Never, ever file a Medicaid application until you are reasonably sure of the result and have a plan in place to deal with that result!
IT’S NEVER TOO LATE
Medicaid planning can begin anytime, even if your loved one is already living in a skilled care facility. But the sooner you plan, the more options you will have to protect what’s important to you.
YOU CAN KEEP YOUR HOME
If you’re married, and you or your spouse needs to go into a nursing home, your home is exempt from Medicaid’s calculation of allowable resources. If you are unmarried or widowed and you go into a nursing home, your house is exempt and you may be able to avoid estate recovery if you follow certain procedures. Planning is key to preserving your home.
DON’T GIVE AWAY THE STORE
Since major changes to laws in 2006, “gifting” away your assets can create unforeseen consequences for years. Far from protecting yourself, you will be undermining your own security.
MIND THOSE SAFE HARBORS
Congress has created a number of “safe harbor” provisions for protecting your assets. These exempt certain assets and allow transfers to children or siblings who meet certain eligibility requirements, as well as putting assets in certain kinds of trusts.
CAREFULLY CHOOSE WHEN YOU APPLY
Applying too early can mean a longer wait for Medicaid qualification than necessary, while applying too late can mean having to pay for months of care needlessly. Rule of thumb: Do not apply for Medicaid without a plan to ensure you qualify.
To qualify for Medicaid in Mississippi:
- You must be a citizen of the United States or an alien lawfully admitted for permanent residence;
- You must be a resident of Mississippi;
- You must meet requirements for age and/or disability, income, resources and other Mississippi Medicaid eligibility requirements;
- You must file an application at the Medicaid Regional Office; and
- You must provide requested verification within the allowed time limits.
The Top 8 Medicaid Mistakes
- Thinking it’s too late to plan
It’s almost never too late to take planning steps, even after a senior has moved to a nursing home.
- Giving away assets too early
First, it’s your money (or your house, or both). Make sure you take care of yourself first. Don’t put your security at risk by putting it in the hands of your children. Precipitous transfers can cause difficult tax and Medicaid problems.
- Ignoring important safe harbors created by Congress
Certain transfers are allowable without jeopardizing Medicaid eligibility. These include: transfers to disabled children, certain caretaker children, certain siblings and into trust for anyone who is disabled and under age 65; a transfer to a “pay-back” trust if under age 65; and a transfer to a pooled disability trust at any age; the purchase of an annuity which will then be “non-countable” yet will allow a supplement of income for the community spouse.
- Failing to take advantage of protections for the spouse of a nursing home resident
These protections include the purchase of an immediate annuity, petitioning for an increased community spouse resource allowance, and in some instances, petitioning for an increased income allowance.
- Applying for Medicaid too early
This can result in a longer ineligibility period in some instances.
- Applying for Medicaid too late
This can mean the loss of many months of eligibility.
- Not getting qualified help
This is a complicated field that most people deal with only once in their lives. Tens of thousands of dollars are at stake. It’s penny wise and pound foolish not to consult with people who make their living guiding others through the process.
- Confusion about the myth of Medicaid “taking my home’
Educate yourself about the rules and policy of estate recovery for Medicaid recipients. Medicaid does not “take your home”. In certain cases there may be no estate recovery at all. Get all the facts from reputable sources and professionals who know and understand the rules.
When applying for Medicaid or other public benefits, there are often many hidden potholes, obstacles, and dangerous curves in the road. We understand these problems, as we have assisted others navigate down this road before — and we are prepared to address them and solve them for you.
We can help you reach the best solution for you and your family.