Medicaid: Do You Qualify for Medicaid?

In order to understand Medicaid qualifications and whether or not you qualify for Medicaid, you first need to know how Medicaid treats your assets.

Medicaid breaks your assets down into two separate categories.  The first are those assets which are exempt and the second are those assets which are non-exempt or countable. Exempt assets are those which Medicaid will not take into account (at least for now). These include:

• Your home, so long as the equity is not greater than $500,000.  The home must be the principle place of residence.  The nursing home resident may be required to show some “intent to return home”, even if this never actually takes place.
• Household and personal belongings, such as furniture, appliances, jewelry and clothing
• One Vehicle, though there is a  limitation on value
• Irrevocable prepaid funeral plans and burial plots
• Cash value in life insurance policy, as long as the face value of the policy does not exceed $1,500.  If the face value exceeds $1,500, the cash value in the policy is countable.  Also, term life insurance is exempt.

These are basically the assets which Medicaid will ignore.  Keep in mind, however, that your state’s estate recovery unit may come back to recoup payments made to a Medicaid recipient after the death of the recipient and the recipient’s spouse if they are married.

Most other assets which are not exempt (i.e. the ones not listed earlier) are countable.  This includes checking accounts, savings accounts, certificates of deposit, money market accounts, stocks, mutual funds, bonds, IRAs, pensions, second cars and so on.  For the most part, all money and property, as well as any item that can be valued and turned into cash, is a countable asset.

While the Medicaid rules themselves are complicated and quite tricky, for a single person it’s safe to say that you will qualify for Medicaid so long as you have only exempt assets plus a small amount of cash ($1,500). For a married couple, the community spouse (i.e. the one not needing nursing home care) can generally keep one half of the assets up to a maximum of $113,640 (in 2012).  Of course, this does not mean there are not techniques which can be taken to protect assets beyond these levels.

This article is part of the eFuneral Resource Center and was written by Timothy J. Forrestal, an accomplished Cleveland, Ohio-based attorney with an impressive track record in the fields of elder law and estate planning.  He is a member of the National Academy of Elder Law Attorneys, the Estate Planning, Trust and Probate Section of the Ohio State Bar Association, the AARP Legal Services Network and the Better Business Bureau. For more information, please visit www.forrestallaw.com. The Forrestal Law Office Medicaid Planning Team offers help in the following areas: Division of Assets, Medicaid Planning, Living Trusts, Powers of Attorney, Estate Planning, Living Wills, Nursing Home Planning, Guardianships. Those thinking about end-of-life should visit eFuneral.com for help researching, planning, and arranging a wide variety of funeral-related services.