A major change has gone into effect regarding the retirement accounts of spouses of those who are applying for Medicaid on or after July 26, 2024. This change will impact married couples who are faced with one spouse needing long-term care, either at home or in a skilled care nursing facility.
The retirement accounts of the healthy spouse had previously been exempt, or “off the table”, as a resource during the Medicaid application process. The new change now results in those retirement accounts being considered as “countable assets” for eligibility purposes. This doesn’t necessarily mean that those retirement accounts must be liquidated, but they are now considered as countable assets throughout the Medicaid eligibility process.
For instance, let’s look at the fictional case of George and Mary, a married couple. George was admitted to the hospital on February 1. He was transferred directly to the nursing home on February 20, where he will reside long-term. His wife is working with a law office on George’s eligibility to protect as much of their assets as legally possible.
His February 1 admission date is known as the snapshot date; this is the date that all the countable assets will be totaled. On February 1, George and Mary had the following countable assets:
• Checking and savings accounts: $50,000
• Certificates of Deposit: $10,000
• George’s retirement account: $30,000
• Mary’s retirement account: $35,000
• George’s life insurance cash value: $2,500
• Mary’s life insurance cash value: $1,800
The home and one vehicle of any value are exempt. The total countable assets on the snapshot date totaled $129,300. One-half of this amount must be “spent down” for George to qualify for Medicaid to help pay nursing home costs. Keep in mind, there are legal ways to “spend down” those funds without having to spend them on nursing home costs.
Since Mary is working with a law office for George’s Medicaid eligibility, she can protect nearly all the countable assets and attain Medicaid coverage for her husband. In this instance, she was able to keep her retirement account even though it was a countable asset. Every case varies based on the facts and assets of each applicant.
If you or a loved one are faced with having to pay out of pocket for nursing home costs, contact my office by phone or text at 812–423-1500 to schedule a free consultation. It is never too late.