Medicaid eligibility for nursing home

[harllee]

I am grateful that my mother does not have to rely on Medicaid and that my husband and I do not have to rely on Mediciad. For people without any assets Medicaid can be a life saver but I am so glad I will not have to rely on it.

 

[MichaelB]

I am grateful that my mother does not have to rely on Medicaid and that my husband and I do not have to rely on Mediciad. For people without any assets Medicaid can be a life saver but I am so glad I will not have to rely on it.

Yes indeed. Having options instead of dependence at that phase of life makes all the difference.

 

[foxfirev5]

When investigating CCRC's for DM, DW dug into the ugly truth. She had worked in healthcare for years and served time in various nursing homes. When visiting the CCRC's she insisted on viewing the ENTIRE facility. Needless to say this request was refused due to "privacy reasons". End of story.

 

[Aerides]

I am grateful that my mother does not have to rely on Medicaid and that my husband and I do not have to rely on Mediciad. For people without any assets Medicaid can be a life saver but I am so glad I will not have to rely on it.

One would hope this is how many of us here plan.

 

[harllee]

When investigating CCRC's for DM, DW dug into the ugly truth. She had worked in healthcare for years and served time in various nursing homes. When visiting the CCRC's she insisted on viewing the ENTIRE facility. Needless to say this request was refused due to "privacy reasons". End of story.

I have just moved into a CCRC. When I first got on the waiting list and later when I was deciding to move in I got a tour of the entire facility, including assisted living, skilled nursing and memory care. I also visited several other CCRCs when I was making decisions and got the full tour. I have never heard of a CCRC that would not give a prospective resident the full tour (except during Covid) and if there is such a place I would mark them off my list.

 

[EastWest Gal]

My brother and I got one parent on Medicaid for assisted living earlier this year. She's in a good place, unlike some Medicaid only facilities in her area, but to get her in she had to have enough assets to pay for the first year.

To qualify they had to get their combined assets, including his IRA, down to about $141K, in their state. There was a 5 year look back to make sure they didn't give away any assets to reach that level. We got the IRA money out before reach $141K so that the $141K limit did not included a deferred tax liability.

At that point Medicaid covers her assisted living and other medical expenses. She has a savings account with no more than $4K allowed at the end of any month. He has the other $137K solely in his name. He also gets both SS checks.

They did not look into any trusts or other ways to try to keep their money. Methods vary by state so the elder law attorney should know the rules and options in your state.

I know that you cannot convert your IRA into a Roth for your wife, and it doesn't matter anyway. They consider all of your assets as joint for these purposes, and Roth and tIRA/401K money are included in the Medicaid asset limit.

I think your home is exempt but check with your attorney. It would make sense to me to pay off the mortgage before reaching the Medicaid asset limit so that the "community spouse" (the one not on Medicaid) does not have mortgage payments to make with the other assets they are allowed to have.

It's good to know your options but some of those may be extreme for a situation that may or may not happen.

1. Home is exempt if the spouse is still in the home or if there is a child or a disabled adult in the home.

2. Medicaid does not directly cover assisted living. However, in our state, there are programs which cover some of the costs. How did you get Medicaid to cover assisted living?

 

[Jenna]

Move to California, they are getting rid of the asset test for elderly Medicaid next year. All other states have a spousal impoverishment allowance of $148,620. That means you any amount over that would need to be spent.

Can you explain this to me? New to all this...

 

[Jenna]

From Chat GPT: Certainly, I can explain this to you.

In the United States, Medicaid is a government-funded program that provides healthcare coverage to low-income individuals, including elderly people who may require long-term care or nursing home services. Medicaid eligibility is based on several factors, including income and assets. The "asset test" mentioned in your statement refers to one of the eligibility criteria for Medicaid.

Here's a breakdown of the key points in your statement:

Move to California: The statement suggests that if you are considering relocating to California, there's a change in Medicaid policy that might be of interest to you.

Getting rid of the asset test for elderly Medicaid: Historically, Medicaid has had strict asset limits, which means that to qualify for the program, your total assets (such as savings, property, and investments) had to fall below a certain threshold. The statement suggests that California is planning to eliminate this asset test for elderly individuals seeking Medicaid benefits. This change would make it easier for elderly people in California to qualify for Medicaid, as they would no longer need to meet the asset limit.

Spousal impoverishment allowance of $148,620: In Medicaid, there are rules that aim to prevent spouses of Medicaid recipients (particularly those needing long-term care) from becoming financially destitute. The $148,620 figure mentioned is likely the "spousal impoverishment allowance" for 2023. This means that in most states, if one spouse needs Medicaid coverage for long-term care and their combined assets with their spouse are less than $148,620, the non-applicant spouse can retain a portion of the couple's assets without affecting the applicant's eligibility for Medicaid. This is to ensure that the spouse not in need of Medicaid benefits doesn't suffer severe financial hardship.

Any amount over that would need to be spent: If the total assets of a married couple exceed the $148,620 spousal impoverishment allowance, they may need to spend down those excess assets before the spouse requiring Medicaid can qualify for benefits. Spending down might involve using those assets for medical expenses, purchasing exempt assets, or other allowable expenditures until they meet the asset limit.

In summary, the statement is advising that California is planning to remove the asset test for elderly Medicaid recipients, which is a significant change compared to most other states. It also mentions the spousal impoverishment allowance, which is a federal provision aimed at preventing undue financial hardship on the spouse of a Medicaid recipient. The specific asset limits and rules can vary by state and change over time, so it's important to consult with your state's Medicaid office or a qualified expert for the most up-to-date information and advice.

 

[LBrowning]

OP here. To clarify, I am looking only at skilled care, i.e. nursing home, as Medicaid does not apply to assisted living or in-home care. I understand that transfers to a spouse do not trigger the 5 year look-back, but must fall under the $148k limit to be exempt. I'm mainly concerned with my 401k/IRAs of about $500k. Medicaid will allow me to keep $2500/mo of my pension. I would have to surrender my SS payments and take my 401k/IRA in equal monthly payments, which Medicaid would also get. So, how best to position this money now, in advance of all this?

 

[RunningBum]

2. Medicaid does not directly cover assisted living. However, in our state, there are programs which cover some of the costs. How did you get Medicaid to cover assisted living?

I don't know all the details since my brother has POA and handled the details. But I do know that the facility gets full payment directly from Medicaid. Maybe it's something done in that state, or maybe I used some term incorrectly. Perhaps "assisted living" is not what she is in. I know that in addition to qualifying financially, she had to be judged to not be able to take care of herself in at least 2 activities of daily living such as eating, dressing, etc, and she easily qualifies.

 

[badatmath]

You really need to discuss this with an attorney in your state but in the meanwhile. . .

Have you read this: https://www.medicaidplanningassistance.org/medicaid-eligibility-401k-ira/

 

[ivinsfan]

OP here. To clarify, I am looking only at skilled care, i.e. nursing home, as Medicaid does not apply to assisted living or in-home care. I understand that transfers to a spouse do not trigger the 5 year look-back, but must fall under the $148k limit to be exempt. I'm mainly concerned with my 401k/IRAs of about $500k. Medicaid will allow me to keep $2500/mo of my pension. I would have to surrender my SS payments and take my 401k/IRA in equal monthly payments, which Medicaid would also get. So, how best to position this money now, in advance of all this?

Is this happening now? What exactly are you attempting to accomplish.....

 

[Spock]

Articles such as this scare the crap out of me with regard to relying on Medicaid care facilities. And yet I'm a long way from being a fat FIRE (RE was due to a layoff in tech vs. voluntary) so self-insurance is for LTC is not feasible.

Compared to "can I retire now?" calculators, I haven't found any "can I afford LTC?" calculators other than those that try to sell extremely limited LTC insurance policies.

About the only action I can take from the linked article is Christmas this year will be care packages at a local facility. I used to build socks+gloves+stocking caps+sundries packages for a homeless shelter... but the elderly seem to be more hidden and with fewer (or no) programs to help.

Nearly two-thirds of American nursing home residents have their care paid for by Medicaid and, in exchange, all Social Security, pension and other income they would receive is instead rerouted to go toward their bill. The personal needs allowance is meant to pay for anything not provided by the home, from a phone to clothes and shoes to a birthday present for a grandchild.

“As soon as I get it, it’s gone,” says Chris Hackney, a 74-year-old resident of a nursing home in Durham, North Carolina, who spends his $30 monthly allowance on body wash, toothpaste, deodorant and some items his facility used to provide but has cut back on, wipes and diapers. “Think of the prices of everything that tripled and quadrupled. And the money hasn’t gone up any.”

https://www.dakotanewsnow.com/2023/03/15/nursing-homes-impoverished-live-final-days-pennies/

 

[LBrowning]

OP again. I'm 70 y/o and trying to plan/position assets well in advance of possible nursing home need. I am meeting with an elder law attorney next week, so I'll post an update then.

 

[LateToFIRE]

Articles such as this scare the crap out of me with regard to relying on Medicaid care facilities. And yet I'm a long way from being a fat FIRE (RE was due to a layoff in tech vs. voluntary) so self-insurance is for LTC is not feasible.

Compared to "can I retire now?" calculators, I haven't found any "can I afford LTC?" calculators other than those that try to sell extremely limited LTC insurance policies.

About the only action I can take from the linked article is Christmas this year will be care packages at a local facility. I used to build socks+gloves+stocking caps+sundries packages for a homeless shelter... but the elderly seem to be more hidden and with fewer (or no) programs to help.

https://www.dakotanewsnow.com/2023/03/15/nursing-homes-impoverished-live-final-days-pennies/

For what its worth, I've been a part of managing LTC for relatives a handful of times. NW of these folks has ranged from zero to seven figures. The good news is that all of these situations worked out just fine.

I know reliance on Medicaid sounds like hell-on-Earth to this crowd, but it does not have to be awful - in fact without it there would be huge social unrest in the U.S. because the vast majority of nursing home patients relay on it.

Yes, horror stories abound, but what makes a huge difference is the PEOPLE you have looking out for you when/if you ever need nursing home care. My observation is that the folks with zero NW got taken care of about as well as the folks with $1M NW - all because they had active and engaged family members looking out for their interests, making sure they were getting treated well, researching all the pertinent topics, and making sure providers were doing the right things.

Now it is true, that if you have to rely on Medicaid for nursing home care, chances are your assets have been exhausted by a horrifically expensive system. And it is true, you won't be going to the swankiest nursing home. But, you will not be homeless, and you will be ok, and there are decent facilities you can get into, with the caveat that you will need people who understand how to deftly navigate and stay on top of a confusing, Byzantine system to ensure you are taken care of properly.

The best thing any of us could do to prepare is making sure you have that network of family, friends, community, and professionals in place.

P.S. #1: When it comes to skilled nursing care, do not make the mistake of equating the swankiest, most expensive facilities with the best care. I found there was zero correlation between cost and quality. That is why due diligence, research, and if possible, professional advice is so critical.

P.S. #2: The other thing to keep in mind is that if you go into a nursing home, the probability is very high that you will not be there for very long - either you're in for short-term rehab and will be discharged in a month or two, or that's where you're going to die and that won't take more than a year, two tops, even with dementia though there are always nightmare exceptions.

P.S. #3: Please keep in mind, Assisted Living is an entirely different thing - purely private pay. I'm talking about Skilled Nursing Facilities (i.e. you have significant physical/medical/healthcare needs that cannot be handled at home).

 

[pb4uski]

I'm planning to meet with an elder law attorney to discuss this, but wanted to get my thoughts together first. In the event my wife or I require nursing home care, I'm trying to navigate Medicaid without leaving the other spouse in poverty. Our combined assets are exempt/below threshold, but my 401k ($500k) pre-tax is the issue. Should I do Roth conversions in my wife's name? Or, do withdrawals and pay off our home? Other options? TIA.

You can't do Roth conversions in your wife's name. To the extent that your home is a protected asset then you could pay off your mortgage.

With the 5 year lookback provision, you need to plan far ahead

 

[jim584672]

As far as the lookback goes, say you transfer $500,000 to your child, that is legal and fine. However if the home cost $100,000 a year the penalty would be 5 years before you are allowed to have Medicaid. It is more complex than that, so roughly speaking.

 

[CardsFan]

OP here. To clarify, I am looking only at skilled care, i.e. nursing home, as Medicaid does not apply to assisted living or in-home care. I understand that transfers to a spouse do not trigger the 5 year look-back, but must fall under the $148k limit to be exempt. I'm mainly concerned with my 401k/IRAs of about $500k. Medicaid will allow me to keep $2500/mo of my pension. I would have to surrender my SS payments and take my 401k/IRA in equal monthly payments, which Medicaid would also get. So, how best to position this money now, in advance of all this?

For clarification: MEDICAID does not GET anything. You would self pay until your assets drop below the limit. MEDICAID will actually PAY for your stay after that point.

Not trying to be nasty, but I had a friend (now passed) who insisted he did not want the gummint to get his money. No amount of rational discussion could persuade him he was wrong.

 

[jim584672]

Say you have $4,000 income a month and the Medicaid income limit is $1,000 a month, how do you get under the limit? The cost of the home is used to "spend down" your income and that way you qualify. Any income goes towards the home and something like $50 a month is allowed for personal needs.

 

[zippy2020]

>>Many (Most?) will accept Medicare after a few years of full pay.>>

First off, Medicare is the wrong program - it is Medicaid that pays for LTC.

Second, there are no hard-and-fast rules for ANY facility, it is very much the Wild West out there. For-profit chains are rapidly acquiring non-profit facilities whenever possible, and quite a few of them, such as Sunrise, are private pay only. You run out of $$$$, you are out as soon as they can find a Medicaid bed. We investigated 8 facilities for my MIL and half of them said they do not take any Medicaid patients.

Also, when they do find a Medicaid vacancy, you may be a long ways away from where your family is. You don't always get a choice.

A family friend chose a senior living facility where meals/housekeeping etc. were provided, but any living/medical assistance had to be paid for by the tenant. It worked very well for her, a lovely facility with great social community in a beautiful safe neighborhood.

We looked at a private care home - they are cheaper, but I found the care level mediocre compared to a really good facility. Their idea of activities was doing puzzles in the LR and watching TV. I'm sure there are good ones, but you really need to personally visit these places to examine all the options.

I strongly feel that there is, in this instance, NO SUBSTITUTE for extensive personal research into what kinds of facilities are available to you, in the area you want to be. Every single place we looked at was different, with its own unique environment.

In the state we live, Medicaid-only facilities are very poor. High turnover, theft, abuse, and the level of care/housekeeping is marginal. They are depressing to visit, let alone live in.

 

[Bdarr]

I am fortunate and have enough to pay my way. I pay taxes and hate when those with assets, hide their money and live off my taxes I pay. Greed is good I guess for some and not paying their way is like beating the system and they feel good about it. Oh well…the way of the world, don't want to pay their own way and live of other tax payers yet in the same breath complain about others doing the same.

 

[MichaelB]

I am fortunate and have enough to pay my way. I pay taxes and hate when those with assets, hide their money and live off my taxes I pay. Greed is good I guess for some and not paying their way is like beating the system and they feel good about it. Oh well…the way of the world, don't want to pay their own way and live of other tax payers yet in the same breath complain about others doing the same.

Good thing then that this thread is not about trying to hide assets or get away with something. It is about paying one’s way while not impoverishing the surviving spouse.

 

[LateToFIRE]

>>Many (Most?) will accept Medicare after a few years of full pay.>>

First off, Medicare is the wrong program - it is Medicaid that pays for LTC.

Second, there are no hard-and-fast rules for ANY facility, it is very much the Wild West out there. For-profit chains are rapidly acquiring non-profit facilities whenever possible, and quite a few of them, such as Sunrise, are private pay only. You run out of $$$$, you are out as soon as they can find a Medicaid bed. We investigated 8 facilities for my MIL and half of them said they do not take any Medicaid patients.

Also, when they do find a Medicaid vacancy, you may be a long ways away from where your family is. You don't always get a choice.

A family friend chose a senior living facility where meals/housekeeping etc. were provided, but any living/medical assistance had to be paid for by the tenant. It worked very well for her, a lovely facility with great social community in a beautiful safe neighborhood.

We looked at a private care home - they are cheaper, but I found the care level mediocre compared to a really good facility. Their idea of activities was doing puzzles in the LR and watching TV. I'm sure there are good ones, but you really need to personally visit these places to examine all the options.

I strongly feel that there is, in this instance, NO SUBSTITUTE for extensive personal research into what kinds of facilities are available to you, in the area you want to be. Every single place we looked at was different, with its own unique environment.

In the state we live, Medicaid-only facilities are very poor. High turnover, theft, abuse, and the level of care/housekeeping is marginal. They are depressing to visit, let alone live in.

I agree with most of what you stated, except the idea that with certain facilities as soon as you convert to Medicaid, you are out. My experience with managing care for parents was more complex than that. True, the private-owned facilities hate Medicaid, and maybe it varies from state to state, but I was under the impression they are required to have a certain number of Medicaid beds available and legally they cannot arbitrarily throw out patients who become Medicaid patients.

That's the official line on private-owned nursing homes. What I was told by the expert consultants we hired, however, is that what happens is that the number of Medicaid beds in those facilities is limited and they only want to fill them with low-maintenance patients (i.e. limited medical requirements). If the patient is problematic in any way or if they convert from private-pay to Medicaid, then they have their ways of moving them out. Often, they will try to discharge to a hospital emergency room for the slightest reason, and then its impossible for the patient to get back in because all the Medicaid beds are filled.

EDIT:

To be clear, nursing homes are generally not REQUIRED to intake Medicaid patients. But, there are regulations around discharging patients solely due to Medicaid. The game is to be able to enter under private-pay and then convert to Medicaid later on. For this reason, the private-owned facilities and even some of the swankier non-profit facilities want a lot of financial disclosure - they want to see enough assets to meet private-pay for at minimum 6 months, in some caes up to 2 years. Because statistically speaking the average nursing home stay is relatively short. Expensive, but short.

I recall one very highly regarded, religious-affiliated non-profit facility had a 6 month waiting list, required us kids and patient to be interviewed, and wanted a full NW statement. I don't think we were getting MIL in without being to show at least $500K in assets (which fortunately she cleared). I swear, this whole process was like trying to get your kid into a selective private school. We did not use the aforementioned facility, but our consultant made some calls and pulled some strings and got her into an equally outrageously expensive facility that supposedly had a long waiting list. You see where I'm going here - they have their ways of screening out the patients they don't want to admit.

 

[athena53]

I agree with most of what you stated, except the idea that with certain facilities as soon as you convert to Medicaid, you are out. My experience with managing care for parents was more complex than that. True, the private-owned facilities hate Medicaid, and maybe it varies from state to state, but I was under the impression they are required to have a certain number of Medicaid beds available and legally they cannot arbitrarily throw out patients who become Medicaid patients.

That's the official line on private-owned nursing homes. What I was told by the expert consultants we hired, however, is that what happens is that the number of Medicaid beds in those facilities is limited and they only want to fill them with low-maintenance patients (i.e. limited medical requirements). If the patient is problematic in any way or if they convert from private-pay to Medicaid, then they have their ways of moving them out. Often, they will try to discharge to a hospital emergency room for the slightest reason, and then its impossible for the patient to get back in because all the Medicaid beds are filled.

EDIT:

To be clear, nursing homes are generally not REQUIRED to intake Medicaid patients. But, there are regulations around discharging patients solely due to Medicaid. The game is to be able to enter under private-pay and then convert to Medicaid later on. For this reason, the private-owned facilities and even some of the swankier non-profit facilities want a lot of financial disclosure - they want to see enough assets to meet private-pay for at minimum 6 months, in some cases up to 2 years. Because statistically speaking the average nursing home stay is relatively short. Expensive, but short.

I agree- my understanding is that MediCARE rehab pays relatively generously and if they want to get that business they have to take a certain % of MedicAID patients.

As for getting them out- this still ticks me off but my Uncle was private pay as his wife watched their assets dwindle (mostly inheritance from her side of the family, ironically). Uncle was pretty much out of it when I visited about a year before he died- she was surprised he recognized me. Just around the time he would have qualified for Medicaid they jacked up the rates to a crazy-high level. She had him moved and he didn't last long ay the new facility. (My cynical guess is that once Medicaid was on the horizon they weren't quite as diligent at keeping him alive.)

Fortunately their two sons are highly successful entrepreneurs- she has macular degeneration and will need help herself soon. This scary tale is one reason I have no plans to remarry. I can fund my own LTC but not anyone else's and the guys on the dating sites who appear to be loaded want arm candy 15 years younger.

 

[LateToFIRE]

I strongly feel that there is, in this instance, NO SUBSTITUTE for extensive personal research into what kinds of facilities are available to you, in the area you want to be. Every single place we looked at was different, with its own unique environment.

In the state we live, Medicaid-only facilities are very poor. High turnover, theft, abuse, and the level of care/housekeeping is marginal. They are depressing to visit, let alone live in.

Agree on the research part - this is critically important.

Disagree on the Medicaid-only. The facilities might look run-down and the patients far more ill, but the quality of care can be high - conversely the swankier private facilities can be nightmares on patient care. It just depends.