One way that people afford to pay for nursing home care is through the use of Medicaid assistance. Numbers show that almost half of nursing home care patients have Medicaid benefits that help them in paying for their stay in nursing homes.
An individual must be regarded to be in need of financial assistance and has difficulty providing medical care for themselves or their family in order to qualify for Medicaid benefits. Their income level should be below the limit set by the government, which is one of the major criteria for Medicaid eligibility. Another way that some people make themselves eligible is by spending down their assets, to the point that they can be considered in the poverty level. There are some states, though, that still consider people who do this method ineligible if they still have sources of income that goes beyond the state limit.
For married couples, Medicaid takes into account the income and assets of the couple if one of them requires nursing home care. The married couples’ countable assets, which can include bank accounts, stocks, bonds, properties, second vehicles and other investments, are brought together and then the value is split between the spouses. Each state may have different kinds of assets considered as countable and this could be verified with the local Medicaid office.
The community spouse, or the spouse not being put into nursing home care, can hold on to his or her own income completely. They can also get half of all joint income together with this up to a certain amount limit yearly. The community spouse can get extra compensation from the income of the other spouse if the own amount of the community spouse falls below the poverty limit. More compensation may be given to the community spouse if there are dependents living with him or her, and if the place where they are living has a rate that is high.
There are some people who receive Medicaid assistance that plan for their stay in nursing homes. This prevents them from spending all of their savings and leaving some of their assets for their family. Some create a trust or transfer their assets to family members.
Since Medicaid considers both the income and assets of both spouses, transferring a person’s assets to their spouse is not advised. For their assets to be protected from eventual Medicaid claims, these must be transferred to other individuals, such as their children. This should also be planned and executed way before one goes into nursing home care and applies for Medicaid coverage.
Assets must have been transferred or moved not less than 5 years before an individual qualifies for Medicaid benefits. This is known as the look back period. If a person is found to have moved their assets within the look back period, they will be considered ineligible for Medicaid coverage, and cannot reapply within 5 years.
There are some states that allow the transfer of assets directly to the spouse of the person who will apply for Medicaid benefits for nursing home care. But, the other spouse is not allowed to transfer these assets to another party, or they will consider the person who applied for Medicaid coverage ineligible.