This blog is the fourth chapter of a series entitled “How to Qualify for Medicaid in Pennsylvania” that focuses specifically on the program for long-term care. Qualifying for Medicaid can be confusing and complicated, but this guide explains it in plain English. If you would like to order a copy of the complete guide click here.
Medicaid Asset Limits for Appliance
Now you know that:
- an applicant must qualify financially in order to receive Medicaid benefits;
- the Commonwealth considers all assets that are available to the applicant (and spouse); and
- some of those available assets are exempt by law.
To qualify for Medicaid, the countable assets must fall below the applicable limit. The applicable limit for a Pennsylvania applicant is either $2,400 OR $8,000, depending on the applicant’s gross income. Use Applicant’s Gross Income to Calculate Limit To find out what an applicant’s limit is, you need to know the applicant’s gross income. For Social Security, that means the figure that appears at the top of the applicant’s annual Statement of Benefits that looks like this:
DO NOT use the figure for Social Security that is direct deposited into the applicant’s bank account each month. That is the net income. Likewise, use the gross income figures for any other income the applicant may receive. Check to see if there are any withholdings for taxes, health insurance, life insurance, etc. If there are, use the gross amount before any withholdings are made. Which Limit Applies Each year, the Pennsylvania Department of Human Services publishes the dollar amount of gross income that will be used to determine the applicant’s asset limit for that year. For 2020, that figure is $2,349. So in 2020, if the applicant’s gross income is greater than or equal to $2,349, then the applicant’s limit is $2,400. If the applicant’s gross income is less than $2,349, then the applicant’s limit is $8,000.
|2020 gross monthly income||Applicant’s limit|
Once we know the applicant’s asset limit, we can fill in another piece of this diagram:
Medicaid Asset Limits for a Spouse
If the applicant has a spouse (who is not also nursing facility clinically eligible), that spouse is referred to as the “community spouse.” An applicant with a community spouse is often referred to as the “institutionalized spouse.” Another asset limit rule applies when there is a community spouse because the community spouse may keep some of the countable assets. The amount the community spouse may keep is called a “community spouse resource allowance” (CSRA for short). The purpose of this rule is to keep the community spouse from becoming impoverished when the applicant qualifies for Medicaid.
The basic CSRA formula is:
= ½ countable assets on date of nursing home admission
Subject to: – minimum of $26,076
– maximum of $130,380
How to Calculate the CSRA
Here is how to calculate the CSRA in five steps:
1. Make sure the applicant’s spouse meets the definition of a community spouse.
If the applicant’s spouse is also medically eligible for Medicaid – that is, he or she is also nursing facility clinically eligible (NFCE) – then there is no community spouse. Neither spouse will qualify for Medicaid until the couple’s combined countable assets fall below their combined individual asset limits. There will be no CSRA.
But if the applicant’s spouse is not NFCE, then he or she is a community spouse. This is true whether the community spouse lives in the marital home, a son or daughter’s home, a senior care residence, or some other facility. The community spouse will be entitled to a CSRA.
2. Identify the couple’s combined assets as of the applicant’s date of nursing home admission.
3. Of the assets identified in Step 2, value the countable assets.
Disregard any assets that were exempt on date of admission. Then take the couple’s remaining assets – those that are countable – and determine each asset’s value on the date of the applicant’s nursing home admission. For an asset that changes value frequently, like a checking account, use a bank statement to see what the exact value was on admission date.
Total the values of all the countable assets.
4. Divide the total from Step 3 by 2. In other words, what is half of the total from Step 3?
5. The CSRA is the result from Step 4, unless it is below the minimum or above the maximum.
Is the number you got when you divided the total in Step 4 above the minimum but below the maximum? If so, then that number is the CSRA.
If the number you got in Step 4 is below the minimum, then the CSRA is the minimum.
If the number you got in Step 4 is above the maximum, then the CSRA is the maximum.
Example #1. The couple’s combined countable assets on date of admission total $200,000 in value. Half of $200,000 is $100,000, which is above the 2021 minimum and below the 2020 maximum. The CSRA is therefore $100,000.
Example #2. The couple’s combined countable assets on date of admission total $40,000 in value. Half of $40,000 is $20,000, which is below the 2021 minimum of $26,076. The CSRA is therefore $26,076.
Example #3. The couple’s combined countable assets on date of admission total $300,000 in value. Half of $300,000 is $150,000, which is above the 2021 maximum of $130,380. The CSRA is therefore $130,380.
So when there is a community spouse, the diagram for what assets may be kept looks like this:
What if both spouses are in a nursing home?
If both spouses reside in a nursing facility or hospital, and are both expected to remain 30 days or more, neither one is a community spouse. To qualify for Medicaid, each would have to spend down to the applicable limits and meet the other eligibility requirements. Countable assets can be apportioned between two such spouses. If gifts have been made during the look-back period, any resulting period of Medicaid ineligibility can also be apportioned between the two spouses. (Gifts and the look-back period will be discussed in more detail in an upcoming blog post.) Each spouse must complete a separate Medicaid application.
This post is part of a series about “How to Qualify for Medicaid in Pennsylvania”
- Medicaid for Long Term Care
- Countable Assets
- Exempt (Non-Countable) Assets
- Asset Limit: Applicant & Spouse
- Spouse's Income
- When No Spend Down Is Necessary
- Gifting & the Medicaid Look Back Period
- How to "Spend Down" to Qualify
- Liability for Care Costs and Applicants' Children
- Medicaid Application Process
- What Happens After Medicaid/ Approval
- Medicaid Waiver Program
- Estate Recovery – What Happens After Death?
14. What is Medicaid Planning?