Each year, certain numbers that affect MoHealthnet or Medicaid planning are released by the State implementing federal guidelines that each state must follow in order to participate in the Medicaid program. Some of these numbers are updated at different points of the year, but January 1 is probably the biggest change that is seen annually.
The term community spouse resource allowance refers to the amount of assets a spouse gets to keep when the other spouse is in a skilled facility and wants to become eligible for Medicaid benefits. This amount is typically one-half of the couple’s countable assets- so if the couple has $100,000 when the sick spouse enters the facility, they will need to spend those assets down to $50,000 before the sick spouse would qualify for Medicaid. However, there are both minimum and maximums for these numbers. These minimums and maximums are set by the federal government are adjusted annually for inflation, just like social security is adjusted. In 2014, the minimum community spouse resource allowance has been $23,448. This number will be raised to $23,488. So, if a sick spouse enters the skilled facility and the couple has $30,000 of countable assets, they will only need to spend $6,512 instead of $15,000. The maximum in 2014 has been $117,240 and this has been increased for 2015 to $119,220.
These increases are approximately equal to the 1.7% increase in Social Security benefits that will also go into effect for 2015. This will be a true increase, as the Medicare Part B premium that the vast majority of Social Security recipients have deducted from their monthly check will remain $104.90, like in 2014. Some higher income seniors do have to pay a higher Medicare Part B premium.
Another number that is adjusted annually in January is the maximum monthly maintenance needs allowance. This number is the absolute maximum need that Medicaid will consider for the monthly expenses of the community (not in a skilled facility) spouse. This number was $2,931 in 2014 and will be increased to $2,980.
Finally, a number that should increase effective in January 2015 is the penalty divisor. This is the calculation to determine how many months an individual will not qualify for Medicaid benefits because they have given assets away in the previous five years prior to applying for benefits. In 2014, this number was $4,744. This number is supposed to represent the average private pay rate for a semi-private room in all skilled facilities in the State. While this figure is significantly lower than the private rate in the urban areas, many of the rural areas are much less expensive, which brings the average down. However, each year, almost all facilities raise their rates (not necessarily on January 1), which causes this number to be increased almost every year. In Missouri, this updated number is usually not released until the spring, as the State calculates this number. So, stay tuned for that number to come out in a few months.
While the numbers change from year to year, one thing that stays constant is that effective Medicaid planning is very complex, and it is virtually impossible for consumers to stay current and to not cause themselves needless frustration (and often substantial expense) as they try to navigate the process. I have seen a significant increase in mistakes made by families that either tried to “do-it-themselves” or relied upon “long-term care cost consultants” or other non-attorney sources that offer to help for a fee. Unfortunately, the perceived savings in not using a skilled elder law attorney was quickly wiped out when the individual was not eligible, and the family ended up paying for several more months of care (at $6-8,000 per month) that could have been avoided with the proper advice. If you need help in planning for long term care, contact our office for a free consultation to see if we can help you!”