This blog post is the eleventh chapter of a series entitled “How to Qualify for Medicaid in Pennsylvania.” This post focuses specifically on what happens after Medicaid approval. Qualifying for Medicaid can be confusing and complicated, but this guide helps explain it easily. You can order a copy of the complete guide here.
Once an applicant is approved for Medicaid benefits and becomes a recipient, the Medicaid program will pay for the recipient’s nursing home care and all reasonable related expenses. Certain other things occur as well.
Patient Pay Amount
A portion (often most) of the recipient’s income is paid to the nursing home each month. The amount that must be paid is referred to as the “patient pay amount” or “patient pay liability.”
The basic formula to calculate the patient pay amount is:
The most common allowable expense deductions are the personal needs allowance, the recipient’s health insurance premiums, income payment to the community spouse to meet his or her monthly maintenance needs allowance, and a guardianship fee. A home maintenance deduction is allowed to defray the cost of maintaining a residence in the rare case in which the recipient is expected to return home within six months. Otherwise, no deduction is allowed to maintain a recipient’s home, even if it is an exempt asset.
Example: Seymour was approved for Medicaid benefits, effective June 1. His only monthly income is from Social Security in the amount of $2,204.60. He has the following health insurance premiums: Medicare Part B, $144.60 and Acme Health, $125. His wife Jane requires $575 in income from Seymour to meet her monthly maintenance needs allowance.
The calculations for Seymour are:
A detailed list of allowable expense deductions can be found online in section 468.31 of the Pennsylvania Long Term Care Handbook (available online here). No deduction is allowed for the withholding of taxes, so it is wise to arrange to stop all tax withholding.
The Long Term Care Handbook also lists, at section 450.5, certain items that will be excluded from income. One notable income exclusion is any income received by a married wartime veteran for “aid and attendance” benefits. The amount attributable to aid and attendance benefits can be given to the veteran’s spouse each month.
Medicaid Community Spouse Asset Allowance
A Medicaid recipient has 90 days from the date of the eligibility determination to retitle assets that a community spouse is allowed to keep as the CSRA. Remember that when a married couple is spending down to qualify, we are concerned only with the combined asset limit. It doesn’t matter in the qualification stage whether an asset is titled jointly, or in the name of one spouse or the other – it is all in one large pool.
After qualification, though, titling does matter. Assets titled solely or partially in the name of the institutionalized spouse cannot exceed that spouse’s asset limit, whether it is $2,400 or $8,000. All other assets must be retitled into the name of the community spouse.
As mentioned in an earlier blog post, the community spouse may be entitled to a spousal maintenance payment if he or she requires income from the institutionalized spouse to meet the monthly maintenance needs allowance (MMNA).
In other cases, the community spouse receives income in excess of the MMNA and therefore receives no spousal maintenance. Such a community spouse may retain all of his or her income, and has no obligation to contribute to the cost of the institutionalized spouse’s care.
Medicaid Renewal & Redetermination
Periodically, the state will conduct a “renewal” or “redetermination,” which is a complete or partial review to make sure the recipient remains qualified for benefits.
A complete renewal is required once a year, while a partial renewal is required based upon the circumstances of the case. The recipient, or someone acting on his or her behalf, will need to provide any information needed to conduct the renewal. The information can be provided by a friend, relative, legal representative, nursing home, or any other responsible person.
The Long Term Care Handbook at section 476.2, lists the following factors that will be reviewed in a complete renewal:
Resources of the individual.
Gross earned and unearned income of the individual.
Gross earned and unearned income of the community spouse and dependents if a community spouse/dependent deduction is needed or requested.
Income expense deductions.
Shelter expenses of the community spouse, if a community spouse maintenance deduction is given.
Third party medical resources, to update the Third Party Liability File.
Medical insurance expenses, such as Medicare and Blue Cross/Blue Shield premiums.
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?