When you are going through life paying taxes on your income, you are contributing into the Medicare program. Each year you can earn as many as four retirement credits. Once you have 40 credits, you have earned Medicare eligibility. The age of eligibility is 65 at the present time.
If you are going to qualify for Medicare coverage as a senior citizen, you may feel as though Medicaid is irrelevant to you. In fact, Medicaid is quite relevant to a significant percentage of senior citizens, because Medicare will not pay for long-term care. Medicaid will pay for long-term custodial care.
Most people will eventually need help with their day-to-day needs, so the gap is quite significant. Long-term care is exorbitantly expensive. In Connecticut, the average annual cost for a room in a nursing home exceeds $100,000. It is not uncommon for people to spend multiple years in nursing homes.
Medicaid is the solution for many, but it is a need-based program. There are income and asset limits. Let’s look at the way that the program would treat a married couple if one person needed long-term care.
Medicaid Regulations
There is an upper asset limit of $2000 in most states for an individual, but some of your belongings do not count. Your wedding rings and heirloom jewelry would not count, one vehicle is not counted, and your home is not considered to be a countable asset.
There is an equity limit of $814,000 in Connecticut in 2014 when it comes to home ownership. However, that limit is completely waived if there is a healthy spouse remaining in the home.
The healthy spouse is referred to as the community spouse in Medicaid circles. The community spouse is entitled to a Community Spouse Resource Allowance. This would be half of the countable assets that are shared by the couple.
In the state of Connecticut in 2014, the maximum Community Spouse Resource Allowance is $117,240. Though the healthy spouse may theoretically keep half of shared assets, this is the limit, even if half of the total would exceed this figure.
There is also a minimum Community Spouse Resource Allowance. The healthy spouse could keep no less than $23,448, even if this figure exceeds half of the total shared assets.
In addition to the Community Spouse Resource Allowance, the healthy spouse is also entitled to a Monthly Maintenance Needs Allowance. Technically, most of the income that is drawn by the institutionalized spouse is supposed to go toward the cost of long-term care.
In spite of this, the community spouse can continue to draw from the income that is due to the institutionalized spouse if it is needed to maintain a minimal standard of living. In Connecticut, the maximum Monthly Maintenance Needs Allowance in 2014 is $2931. The minimum is $1,938.75.
Free Medicaid Planning Report
If you would like to learn more about Medicaid rules and regulations, download our report on the subject. The report is being offered free of charge, and you can obtain access through this link: Medicaid Planning Report.
Mr. Nirenstein is licensed to practice before the courts of the State of Connecticut and the United States District Court. He is a member of the Connecticut and Hartford County Bar Associations, and the Estate and Probate, Elder Law, Business Law and Real Estate Sections of the Connecticut Bar Association.
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