Category: Medicaid

On February 8, 2006 President Bush tightened asset spend down rules on seniors seeking nursing home assistance. These rules will force more families to cover the costs of nursing home care and delay coverage for those most needy.

The bill is designed to tighten loopholes that allowed transferring assets to children so they then could qualify for Medicaid. With nursing home care increasingly becoming more and more expensive with the average yearly care costing $74,000 nationally one can expect further tightening.

To qualify for Medicaid nursing home coverage, most states require a single individual to have no more than $2,000 in cash including other forms of income. There are certain assets such as a home, car and certain trusts that are not counted. Married couples are allowed more. After qualifying an individual must spend all their income on their nursing home care except for an amount under $50 a month for personal expenses.

Medicaid allows individuals to reduce their assets by prepaying for funeral expenses, buying a car, paying off debt and making home modifications. A person with more than $150,000 in equity in a home may be ruled ineligible for Medicaid. Other methods such as gift giving to family members, transferring property and creating certain annuities may trigger a penalty and further delays.

If your currently in a situation where spend down is happening or you wish to prevent it in the future. Get a free analysis on your situation and a plan of action. Please feel free to write or call me Bob Kessler at 1-800-690-8969 or write me, Bob Kessler, at my office — American Benefits Company LLC, 30095 Northwestern Highway Suite 101, Farmington Hills, MI 48334.

I found this info on this webpage
http://aspe.hhs.gov/daltcp/reports/syncri.htm

“Asset spend-down in nursing homes is the process by which individuals enter nursing homes as private pay clients, deplete their available assets in paying for their care, and then enroll in the Medicaid program once they are impoverished. “Medicaid asset spend-down” is a source of considerable concern to disabled elderly persons who face the prospect of extended nursing home care.”

 Just the sound of this is frightening.  Work your entire life, then, faced with some terrible illness that requires strangers to take care of you, spend all your money on your health care so that you can have the government finish “taking-care” of you for the rest of your life.  And if you have a spouse that is healthy, they will become impoverished too, right along with you as you spend down your combined assets.

And from this site

http://www.financinglongtermcare.umn.edu/basics/financialoptions/

factsheet/spenddown/spenddown1.htm

“What is it like to spend down to Medicaid?

Marlene S. Stum, Ph.D. Family Social Science

What is a spend down?

“A spend down occurs when private or family finances are depleted so far that an individual becomes eligible for public sources of payment through Medicaid. This process of voluntary impoverishment is a transition from private to public sources of payment for long-term care.” (Stum, 1998).

What is it like to spend down to Medicaid to pay for long term care?

A study of families who were spending down to Medicaid to pay for long term care and those who had already become eligible for Medicaid, found that families experienced multiple losses including; loss of control, choice and dignity (Stum, 1998). The following are quotes from the study that illustrate the specific themes that emerged from the research both for families that were in the process of spending down to Medicaid and those who had already become eligible for Medicaid.

Families in the Spend Down Process
Stretching Personal Resources

Lack of Control
“I just keep hoping that our money is going to hang on and that the house will sell. They say, ‘Oh this must cost $100 per month in here!’ I just say ‘yes’. I know it would kill both of them if they felt they were going to run out of money.” (Niece caregiver of two aunts in their nineties in a nursing home.)

“Everytime we have to dip into savings to pay for some of Dad’s care, it is a real concern to Mom that eventually she is not going to have anything. We try to reassure her that it will be okay, that we can only take it day by day. I think she feels that she is no longer in control and that she is going to lose her savings. We don’t know if Dad’s care is going to increase or if he might live to be 102. I say, ‘you know Mom, Dad could die tomorrow and we wouldn’t have to worry-we just don’t know-and we can’t sit and worry about the unknown.’” (Daughter of mom (age 75) and dad with dementia in a nursing home.)”

My friend Bob has a plan for you.  He’s recommended this plan to many low income seniors as a way to hang on to some personal assets and still have coverage for medical expenses.  We’ll be letting you know about it in the very near future.