On Friday, May 31st, attorney Paula Mattson-Sarli discusses Medicaid spend down.

If you have a spouse who has ended up in a nursing home who may not return home for their health. Financially, this can become quite burdensome.

After reviewing your financial situation, you can determine if you are Medicaid eligible or need to private-pay.

The first step is for the social worker at the nursing home to determine that you have run out of free days and will need to either apply for Medicaid or pay their daily rate.

If it is determined you wish to apply for Medicaid on behalf of your spouse, often times you will be referred to an elder law attorney to discuss a spend down.

We would then need to count all assets of the married couple. Titling won’t matter and it will start from the first of the month that they entered care.

For an example, say Mr. and Ms. Jones on April 1st had $300,000 in gross assets. We then allocate half to each spouse. The one at home is considered the community spouse. The first spouse (community spouse) can keep up to $154,140 and the spouse in care can only keep $2,500.

That leaves about $145,000 that needs to be spent down. It has to be spent properly and not just given away. Uses such as paying off debt, pre-paying for funeral arrangements for themselves or children, buying a new car or a new property or paying off a mortgage.

If we can’t come up with enough proper expenses, we can explore a Medicaid compliant annuity. This creates an income stream for the community spouse.

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