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Approved for Medicaid: What If You Are the At-Home Spouse?

April 12, 2018 By wrlaw

Many North Carolina Medicaid situations involve a spouse needing care and health spouse that can still live at home. During the Medicaid application process, there are steps that an at-home spouse will need to take to ensure that he or she is protected to the fullest extent possible from any adverse Medicaid claims.  However, following the in-care spouse’s approval for Medicaid, the at-home spouse should take some additional steps.

Adjust Your Estate Plan

If you work with an experienced Elder Law attorney, he or she will likely encourage you to change your estate plan in conjunction with the Medicaid application and spend down.  The reason is that if the at-home spouse dies before the in-care spouse, the assets that were shifted to the at-home spouse for Medicaid qualification purposes may end up going right back to the in-care spouse. If that happens, not only will the in-care spouse lose Medicaid coverage, but all of those assets are now subject to spend down and claims for estate recovery.

Unfortunately, changing your estate plan may not be as simple as hopping on LegalZoom and generating a new Will.  The at-home spouse will want to make sure that the assets are disposed of properly and that if the he or she predeceases the in-care spouse, that the assets are retained in trust for the benefit of the in-care spouse in such a manner as to not affect Medicaid eligibility.  If you own real property, you will want to make sure ownership of it is properly structured.  You will want to make sure beneficiary designations are changed. There are a lot of steps that need to be taken, not all of which can (or should) be taken without the guidance of an Elder Law attorney.

Keep Assets Separate

Once the in-care spouse is approved for Medicaid, there will be ongoing redeterminations to ensure that the individual still qualifies for Medicaid.  The important thing to remember here is that unless the at-home spouse also ends up applying for Medicaid, the Department of Social Services that handled the application will not look at the assets of the at-home spouse again.  The at home spouse can receive inheritances and build up assets without fear of needing to go through additional spend down following a redetermination.

However, the at-home spouse needs to keep their assets separate from the in-care spouse.  Do not add the in-care spouse to any new accounts that are opened or property that is purchased.  If it happens, Medicaid coverage may be terminated.

Maximize the Spousal Income Allowance

The at-home spouse is, in certain situations, allowed to keep a portion of the income of the in-care spouse.  However, there is a limit to what can be retained, and if the at-home spouse’s income is large enough, there may be no retention. The determination of how much can be retained is made by the caseworker during the application, but it can also be adjusted throughout.  If the at-home spouse’s expenses increase, be sure to contact the caseworker and request a reassessment of the amount allowed.

Being approved for Medicaid is a relief, but it is important for the at-home spouse to stay aware of the situation and make sure that they are doing everything possible to protect the spouse receiving care and themselves.

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Filed Under: Medicaid Planning

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