Do I qualify for Connecticut Medicaid coverage of long term care expenses?

March 7, 2015

Financial eligibility for Medicaid coverage of long term care expenses is based upon:

1. financial responsibility,
2. countable income and
3. countable assets.

FINANCIAL RESPONSIBILITY

When one member of a married couple is a resident of a medical institution, and is expected to remain in the facility for 30 days or more, the total value of countable assets of both spouses is determined, and a community spouse protected amount (“CSPA”) is established, in determining the financial eligibility of the institutionalized spouse.
The income of the spouse at home is not counted in the determination of eligibility of the institutionalized spouse.  In some cases, some portion of the income of the institutionalized spouse may be diverted to support the spouse at home.

When both spouses live in the same long-term-care facility, the income and assets of each spouse are evaluated separately to determine eligibility of that spouse.

COUNTABLE ASSETS

In order to qualify for Connecticut Medicaid coverage of nursing home care, countable assets must be under a certain limit.  For a single individual, that limit is $1,600.00.  For a married couple, that limit is $1,600 plus the applicable CSRA.

The term “countable assets”  generally includes all assets to which the applicant or the spouse would be entitled whether or not these assets are actually received, when failure to receive the assets results from the action or inaction of the applicant, member, spouse, or person acting on his or her behalf.

Countable assets generally includes:

• Cash,
• Bank accounts,
• Certain retirement accounts,
• The cash value of all life insurance policies if the total face value of all policies having a cash    surrender value is $1,500 or more,
• The equity value of all vehicles other than one vehicle per household used by a member of the couple or a member of the couple’s household,
• The value of real estate other then the principal residence (subject to certain limits) and certain business property,
• The principal value of a trust established by a member of the couple or of which a member of the couple is a beneficiary may be countable, and
• Annuities which may be converted to a lump sum are countable assets.

COUNTABLE INCOME

Once the asset test is met, the countable income of the individual in the nursing home is determined in order to calculate the applied income.  The applied income is the amount that must be paid to the nursing home each month.

The countable income includes earned and unearned income, less certain business expenses and standard income deductions.  General income deductions include: (1) a personal needs allowance (“PNA”), (2) a spousal monthly maintenance needs allowance, (3) a utility allowance, (4) a shelter allowance, and (5) health care coverage and incurred medical and remedial care expenses.

FAIR HEARING ADJUSTMENTS

In certain cases, an additional deduction may be applied to the institutionalized spouse’s income in order to increase the income of the community spouse to meet the minimum monthly maintenance needs allowance.  This additional deduction may be granted by a hearing officer following an appeal and a fair hearing.  If after this adjustment, the fair hearing officer determines that the community spouse’s income is still too low, then the hearing officer may increase the community spouse’s asset allowance.

DISQUALIFICATION RULES AND THE LOOK-BACK PERIOD

The Connecticut Medicaid program rules discourage people from giving away their assets to qualify for Medicaid coverage of nursing home expenses.  These rules deny payment for nursing home care to an otherwise eligible applicant who has given away assets that could otherwise have been used to pay for care.  Payment is denied for a period based upon the value of the gift.  This is called a “penalty period.”  The disqualification period starts when the applicant is otherwise financially eligible for Connecticut Medicaid coverage of nursing home expenses.

When an application for Medicaid is submitted, transfers of resources must be investigated.  The period of this investigation is referred to as the “look-back period,” which begins on the first date the individual is both a nursing home resident and has applied for Medicaid.  The look-back period is 5 years.  Not all transfers and gifts cause a penalty period.  Special rules apply to certain annuities and certain transfers to or trusts for disabled persons and spouses.