Assets

By Jessica L. Estes

Long-term care Medicaid is a needs-based program that helps qualified individuals pay for long-term care costs.  Long-term care is required when an individual, for a period exceeding thirty days, is unable to perform the basic activities of daily living such as bathing, dressing, eating, toileting, walking, and transferring.  Long term care can include homecare, adult daycare, respite care and assisted living or nursing home services, but long-term care Medicaid will only cover nursing home services.  As such, an individual must be admitted to a nursing home or other long-term care facility in order to apply for long-term care Medicaid.   

Moreover, there are three eligibility criteria that an individual must meet to qualify for long-term care Medicaid: (1) technical; (2) medical; and (3) financial.  In Maryland, to be technically eligible, an individual must be (1) a resident of Maryland; (2) aged 65 or older, blind, or disabled; and (3) a United States citizen or resident alien.  For purposes of Medicaid, an individual is considered a Maryland resident from the moment they are admitted to a nursing home in Maryland, even if their primary residence is located in another state or the District of Columbia.

To be medically eligible, an individual for a period exceeding thirty days, must require skilled nursing care, assistance with at least three activities of daily living, or assistance with at least two activities of daily living if the applicant also needs assistance with an instrumental activity of daily living.  Skilled nursing care is care or treatment that can only be done by doctors or nurses such as complex wound dressings, rehabilitation, or tube feeding.  Instrumental activities of daily living are not necessary for fundamental functioning but are necessary for an individual to live independently in the community.  Instrumental activities of daily living include such things as using a telephone, shopping, preparing meals, housekeeping, or money management.

Most individuals in a nursing home will meet the technical and medical eligibility criteria; however, the financial eligibility requirements are two-fold and most people will not immediately be eligible.  There are two tests an individual must pass to be financially eligible for Medicaid: the income test and the asset test.  The income test is simple.  If a person’s gross monthly income is less than the monthly cost of care at the facility, that person will pass the income test, and because the monthly cost of care at a nursing home is so high, most do.

The asset test, although simple, is not quite so easy to pass.  An individual cannot have more than $2,500 in countable assets as of the first of the month in which he or she applies for benefits.  As such, most people will need to “spend-down” their assets below that $2,500 limit to be eligible for benefits.  But, be careful!  The Medicaid qualification process is very complex and trying to navigate these rules alone, or with the assistance of a non-attorney, likely will result in wasted time, stress and frustration, and an unnecessarily large nursing home bill.  Instead, seek the advice of a competent elder law attorney who will not only obtain Medicaid benefits for his or her client, but preserve some, or all, of the client’s assets as well.