How to Protect Your Assets When Your Spouse is entering a Massachusetts Nursing Home

The Medicaid law provides special protections for the spouse of a nursing home resident to make sure she has the minimum support needed to continue to live in the community.

The so-called “spousal protections” work this way: if the Medicaid applicant is living in Massachusetts and is married, the countable assets of both the community spouse and the institutionalized spouse are totaled as of the date of “institutionalization,” the day on which the ill spouse enters either a hospital or a long-term care facility in which he or she then stays for at least 30 days. (This is sometimes called the “snapshot” date because Medicaid is taking a picture of the couple’s assets as of this date.)

In general, the community spouse may keep one half of the couple’s total “countable” assets up to a maximum of $109,560 (in 2010). Called the “community spouse resource allowance (CSRA),” this is the most that Massachusetts may allow a community spouse to retain without a hearing or a court order. The least that Massachusetts may allow a community spouse to retain is $21,912 (in 2010).

Let’s take a look at an example: If a couple living in Boston has $200,000 in countable assets on the date the applicant enters a nursing home, he or she will be eligible for Medicaid once the couple’s assets have been reduced to a combined figure of $111,560 — $2,000 for the applicant and $109,560 for the community spouse.

In all circumstances, the income of the community spouse will continue undisturbed; he or she will not have to use his or her income to support the nursing home spouse receiving Medicaid benefits. But what if most of the couple’s income is in the name of the institutionalized spouse, and the community spouse’s income is not enough to live on? In such cases, the community spouse is entitled to some or all of the monthly income of the institutionalized spouse.

How much the community spouse is entitled to depends on what the Medicaid agency determines to be a minimum income level for the community spouse. This figure, known as the minimum monthly maintenance needs allowance or MMMNA, is calculated for each community spouse according to a complicated formula based on his or her housing costs. The MMMNA may range from a low of $1,821.50 (from July 1, 2009, through June 30, 2010) to a high of $2,739 a month (in 2010).

If the community spouse’s own income falls below his or her MMMNA, the shortfall is made up from the nursing home spouse’s income.

For example, Mr. and Mrs. Smith live in Newburyport, have a joint income of $3,000 a month, $1,700 of which is in Mr. Smith’s name and $700 is in Mrs. Smith’s name. Mr. Smith enters a nursing home and applies for Medicaid. The Medicaid agency determines that Mrs. Smith’s MMMNA is $1,700 (based on her housing costs).

Since Mrs. Smith’s own income is only $700 a month, the Medicaid agency allocates $1,000 of Mr. Smith’s income to her support. Since Mr. Smith also may keep a $72.80 a month personal needs allowance, his obligation to pay the nursing home is only $627.20 a month ($1,700 – $1,000 – $72.80 = $627.20).

In exceptional circumstances, community spouses may seek an increase in their MMMNAs either by appealing to MassHealth or by obtaining a court order of spousal support.

If you would like to discuss in detail your situation please call me at 978.270.2189.