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Moving into a nursing home facility is a crucial decision for the person moving into a nursing home and their spouse. There is a significant amount of financial planning which must be done to meet and maintain eligibility requirements and still allow their spouse to maintain a comfortable lifestyle. In this article, our Iowa Elder law attorneys discuss when you or your loved one may be eligible for Medicaid when moving into a nursing home.
Is There an Income Limit to Qualify for Medicaid Nursing Home Assistance?
In 2021, the income limits for qualifying for nursing facility assistance from Medicaid was $2,382 per month, 300% of the federal supplemental security income (SSI) benefit amount for one person. Only the income of the spouse applying for Medicaid is counted. The applicant must also be deemed to require nursing home assistance.
What If Someone’s Income Is Over the Required Monthly Amount?
Suppose someone’s income level is higher than $2,382 per month. In that case, they may still be eligible if they set up a Medical Assistance Income Trust, also known as a Miller Trust. This trust is a special kind of trust. A trust requires a person who owns the property (a trustor or settlor) to transfer property into a trust to be managed by a trustee to benefit a beneficiary.
In this case, a person who will enter the nursing home is the settlor and the beneficiary. The trustee is usually the person in the nursing home’s spouse or another family member. An attorney can help you set up this kind of trust.
The money to go into the trust must be from either Social Security income or pension income. A small amount, usually about $60, can be paid out of the trust for trust expenses and the person’s personal needs monthly. The balance will go to the nursing home. Some may also be given to a spouse who does not live in a nursing home.
Iowa also has a “spenddown” program for people 65 and older, blind, or disabled. People using this program are allowed $10,000 in assets for the household. People may still be eligible for Medicaid if they are over income by spending down their income to an amount of money called the Medically Needy Income Limit on medical expenses.
These expenses include past-due medical bills, private health insurance premiums, and medical expenses Medicaid will not cover. In 2021, someone must spend down $483 per month. So, when someone gets down to $483 for the month, Medicaid will kick in for whatever is left that month.
Are There Any Other Eligibility Limits?
A person must have $2,000 in assets or below to be eligible, $3,000 per couple. There are certain exemptions that will not count toward this number, such as the home they live in (homestead exemption), one vehicle, prepaid funeral plans, and most personal belongings. The person’s home equity, the amount of the home they own, as of 2021, must be under $603,000.
If a spouse does not live in the nursing home, they are referred to as the community spouse. The community spouse usually can keep one-half of the couple’s total non-exempt assets, at a minimum of $26,076, up to $130,380. If the couple’s assets are under $26,076, the community spouse can claim the entire amount. If the spouse’s monthly income is less than $3,259.50, then they may be entitled to all the spouse in the nursing home’s income. Suppose the couple’s income is less than $3,259.50 per month.
In that case, the community spouse can ask to be allowed for additional assets for reasons like limited income, life expectancy, and the amount of the original attribution.
Iowa has a 60-month (5 years) look-back period, meaning Medicaid will look back five years to see if anything was sold at less than reasonable value, including gifts. Suppose the Department of Human Services (DHS) finds any violations. In that case, a person will lose Medicaid eligibility for a certain amount of time.
Are There Medicaid Services That Allow Someone To Remain Living At Home?
Iowa has Medicaid Waivers/Home and Community-Based Services (HCBS) with income and asset limits the same as nursing homes. However, there is a cap on the number of people who can use these services, and people are often put on a waitlist.
What If Both Spouses Are Applying for Nursing Home Assistance Or HCBS?
If both spouses apply for nursing home assistance, there is a $4,764 per month limit, with each spouse allowed up to $2,382 per month. There is a $3,000 asset limit. After six months of eligibility, the spouses may choose to be considered single applicants. Each can have up to $2,382 per month in income and $2,000 in assets or still be treated as a couple.
How Does Someone Apply for Nursing Home Assistance?
The DHS provides a Services Portal, which applicants can use or apply in person at a local DHS office. An attorney will be able to help with Medicaid planning, setting up trusts and other planning instruments, and ensuring the application is completed in the way most beneficial to the applicant.
For legal advice on figuring out you or your loved one's Medicaid eligibility and health coverage in Iowa contact O'Flaherty Law firm and one of our experienced Iowa lawyers. You can give us a call at (630)-324-6666 or fill out our confidential contact form today.
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