“The Basics of Medicaid: What You Can and Cannot Keep”

In order to understand Medicaid qualifications, you first need to know how Medicaid treats your assets. In Massachusetts the Medicaid program is called MassHealth.

Basically, Medicaid breaks your assets down into two separate categories. The first are those assets which are exempt and the second are those assets which are nonexempt or countable.

Exempt Assets
Exempt assets are those which Medicaid will not take into account (at least for the time being). Generally the following assets are exempt:

• The home, no matter its value. The home must be the principal place of residence. The nursing home resident may be required to show some “intent to return home,” even if this never actually takes place.
• Household and personal belongings, such as furniture, appliances, jewelry and clothing.
• One vehicle, there may be some limitation on value.
• Prepaid funeral plans and burial plots.
• Cash value of life insurance policies, as long as the face value of all policies added together does not exceed $1,500. If it does exceed $1,500 in total face amount, then the cash value in these policies is countable. Also, term life insurance is exempt.
• Cash (e.g. a small checking or savings account) not to exceed $2,000.

These are basically the assets that Medicaid will ignore, at least for now. Keep in mind, however, that the estate recovery unit may come back to recoup payments made to a Medicaid recipient after the death of the recipient and the recipient’s spouse if they are married.

Nonexempt Assets
All other assets which are not exempt (i.e. ones not listed earlier) are countable. This includes checking accounts, savings accounts, certificates of deposit, money market accounts, stocks, mutual funds, bonds, IRAs, pensions, second cares and so on. While there are some minor exceptions to these rules, for the most part, all money and property, as well as any item that can be valued and turned into cash is a countable asset, unless it is one of those listed earlier as exempt.

While the Medicaid rules themselves are complicated and somewhat tricky, for a single person it’s safe to say that you will qualify for Medicaid so long as you have only exempt assets plus a small amount of cash ($2,000).

For a married couple the community spouse (i.e. the one not needing nursing home care) can generally keep one-half of the assets up to a maximum of just under $91,000. Of course, this does not mean there are not things that can be done to protect assts beyond theses levels. Instead, this issue of Elder Law Today is designed to review the basics in a way which a caseworker from MassHealth would do so.

In other issues of Elder Law Today we have covered ways that single persons can often protect 50% or even more of their assets and married couples can often protect all of their assets.

Future issues will be dealing with related topics covering additional Medicaid planning strategies as well as nursing home selection and care issues.

Elder Law Today is produced by Robert L. Surprenant and Michelle D. Beneski, Attorneys at Law. This newsletter is published as a service of The Medicaid & Estate Planning Strategies Law Firm, P.C. 286 Union St., New Bedford, MA 02740. This information is for general informational purposes only and does not constitute legal advice. For specific questions, contact a qualified attorney.

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The Medicaid & Estate Planning Strategies Law Firm, P.C. offers in-service training on topics related to:

• Division of Assets
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• Powers of Attorney
• Other Elder Law Issues

	Legal Disclaimer: This information has been provided for informational purposes only. It does not constitute legal advice. The receipt of this information does not establish an attorney-client privilege. Proper legal advice can only be given upon consideration of all the relevant facts and laws. Therefore you should not act upon any of the information contained herein without seeking appropriate legal counsel. Copyright 2004 The Medicaid & Estate Planning Strategies Law Firm, P.C.