When a married person applies for Medicaid, the government looks at the collected, or, pooled, resources of the two to determine if one of the two spouses is eligible for Medicaid. If the combined income of the two spouses is above the income threshold set by law, the balance must be paid to the nursing home of the dependent spouse. But what income provisions are allowed for the spouse who remains in the community? What do the get to keep? Is the community spouse allowed to tap into the income of the dependent spouse if his/her income is not enough?
The legal, financial benefits that allow for the community spouse to keep a certain amount of income has the terrible name of spousal impoverishment standards. This contains an amount of money, known as the minimum monthly maintenance needs allowance (commonly known as or referred to as the MMMNA). The figure from July 1, 2015 to June 30, 2016 is $1,991.25 per month. Starting on January 1, 2016 the maximum monthly maintenance needs allowance is set at $2,980.50 per month. This is the maximum the community spouse may keep before being required to contribute to the medical needs of the dependent spouse (NOT minimum, so not to be confused with the MMMNA).
WHAT IF THIS IS NOT ENOUGH?
If the community spouse makes less than the minimum amount, he/she may keep all of that income, plus tap into the dependent spouse’s income to insure that their income rises to that minimum monthly maintenance threshold. If the community spouse can establish that their housing costs are more than 30% of their monthly needs, then the community spouse can add that additional amount for excess shelter allowance. The formula or means by which the community spouse determines their income is called the Community Spouse Monthly Income Allowance (also known as the CSMIA). To determine the CSMIA involves four steps:
- First step – Determine minimum monthly community spousal need. As noted, from July 1, 2015 to June 30, 2016 that figure is $1,991.25.
- Second step – Add any additional shelter costs that exceed 30% of their monthly need. Say for example the community spouse can establish that their housing or shelter costs $1,000. 30% of $1,991.25 is (rounded) $598. So the excess of that is $402 per month.
- Third step – Add the first two steps above together. In the example provided the sum is (rounded) $2,393. Since this amount does not exceed the maximum monthly maintenance need, the community spouse keeps this amount.
- Fourth step (if needed) – If the community spouse made less than the MMMNA, you subtract this amount from the figure from step three above. In the simple example above, say the community spouse earns $1,000 per month. Subtract $1,000 from $2,393, which equals $1,393. This is the amount that the community spouse may utilize of the dependent spouse.
If for any reason this amount exceeded the maximum monthly maintenance need,the community spouse would only be entitled to keep the maximum monthly maintenance amount and provide anything in excess of the maximum monthly maintenance amount for the care of the dependent spouse.
Medicaid planning is intricate and extraordinarily fact sensitive. Only a consultation with an experienced elder law attorney will do to provide the level of assurance and peace of mind needed.