What is the “Maximum Community Spouse Resource Allowance” in 2017 for Alabama Medicaid long term care in a nursing home
Continuing our series on Alabama Medicaid in 2017 for long term care in the nursing home, let’s look at the maximum assets the community spouse can keep.
Let’s remember a few things before we get started.
Medicaid calls your assets “resources”.
The spouse in the nursing home is called the “institutional spouse” while the spouse living at home is called the “community spouse”.
OK let’s take a look at this idea of the maximum the community spouse can keep while still getting the institutional spouse the Medicaid coverage to pay for the nursing home . . . .
“What is the maximum amount the community spouse can keep?”
$120,900 for the community spouse who is still living at home.
“How do we calculate the resources or assets?”
We take the total “countable” assets and then divide them in two.
Half to the institutional spouse going into the nursing home.
And the other half to the community spouse living at home.
“What is the minimum community spouse resource allowance — in other words what’s the minimum the spouse at home keeps?”
When you do the math, the community spouse must have at least $27,000. (The linked article goes into this in detail).
“What else can the community spouse keep over and above the maximum?”
While not everything, this will give you a good start:
- Household goods and items (furniture, clothes, etc)
- One vehicle
- Limited amount of life insurance and some prepaid burial or funeral expenses
The items above are considered “non countable resources” so they don’t get put into the pile that we divide by half.
Let’s go through some examples with various couples to see how this works.
Keep in mind there are all sorts of exceptions and even “exceptions to the exceptions” but these examples will give you a start to how this process works. Remember to get the right advice from the right professionals as mistakes in this area can cost families tens or even hundreds of thousands of dollars. Assume in each example it is the husband going into the nursing home (institutional spouse) and the wife remains at home (community spouse).
Sarah and Sam have countable resources of $300,000.
We divide the assets in half.
So Sarah gets $150,000 and Sam get’s $150,000.
Sarah is over the community spouse maximum so she can only keep $120,900.
And Sam as the institutional spouse can only keep $2,000.
So we have about $177,100 that we need to do something with so it won’t be lost to the nursing home bill.
Jennifer and James have countable resources of $100,000.
In this example, we divide $100,000 into two and get $50,000.
So Jennifer gets $50,000.
James also gets $50,000.
Jennifer is over the minimum amount ($27,000) and under the maximum amount of $120,900 so she can keep the full $50,000.
James is over the maximum of $2,000 for the institutional spouse so we’ll need to figure out how to save this “excess” $48,000.
Sandra and Stan have countable resources of $700,000.
Dividing $700,000 in half we get $350,000 for each person.
Sandra has too much — the maximum limit is $120,900.
And Stan has too much — remember he can only keep $2,000 as the spouse going into the nursing home.
Fortunately there are a number of options to preserve as much as possible of the “excess” $577,100 in assets.
Bill and Bonnie have countable resources of $35,000.
We divide this in two and get $17,500 for each of them.
For Bonnie, she is below the minimum of $27,000. So we raise her to $27,000.
That leaves Bill with $8,000.
But that’s more than his maximum of $2,000 so we have an “excess” of $6,000 we need to handle.
“What if there is more money/resources — is that lost or is there something that can be done with it?”
We absolutely can protect much (if not all) of the excess resources.
Here are a few options and we’ll cover these in depth in future articles:
- Can we spend that money on “exempt” assets such as the house?
- Can we pay down debt?
- Perhaps we buy an annuity and give away some of the assets
Here’s the bottom line. When we are helping married couples, we normally can save 75% or more of the excess assets.
We do this with our unique guarantee where we tell you exactly what will be saved, what (if any) penalty period there will be with Alabama Medicaid, and the if
“If I have questions about how to preserve the family assets while still getting the needed care how do I get answers?”
We understand this area of the law can be confusing and raise a lot of questions.
We’ll be glad to help you think through your options.
Simply pick up the phone and call us at 205-879-2447 or you can fill out our contact form and then we can email or call you right back.
We can meet in person or most families prefer to do our initial meeting over the phone — we’ll be able to tell you quickly about your options and help you think through what’s best for your family.
Thanks for reading this and we’ll talk to you soon….