Medicaid Planning for Single Individuals

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Medicaid Planning for Single Individuals

Medicaid eligibility for a single person involves the creation of a unique plan tailored to each individual that includes an assessment of their assets and income, prior gifting within the five (5) year look-back period, estate recovery, as well as related income and inheritance tax implications.

In general, a single person is required to complete a spend-down of their financial assets in order to become eligible for Medicaid. Depending on their monthly income, a person may keep either $2,400 or $8,000 in countable assets.

Countable assets include, but are not limited to:

  • Bank accounts
  • Investment accounts
  • Life insurance policies
  • Multiple automobiles
  • Real estate that is not your primary residence

Non-countable assets, or assets that are not counted against the money a person can keep, include but are not limited to:

  • A primary residence
  • One automobile

It is essential to meet with an experienced elder law attorney at Zacharia Brown who knows and understands the complex and wide-ranging Medicaid laws in order to protect as many financial assets as possible for you or a loved one.

What Happens to My Income

For a single individual, the law requires a person receiving Medicaid in a nursing home (skilled nursing facility) to pay most of their monthly income to the nursing home to apply toward their cost of care. Before the nursing home resident pays their monthly income to the nursing home each month, they are permitted and even required to continue paying for their monthly health insurance through Medicare and/or a supplemental health insurance provider. In addition to paying their monthly health insurance premium(s), the nursing home resident may keep a $45.00 personal needs allowance per month to spend as they wish before paying the remainder of their income to the nursing home each month.

Primary Residence and Estate Recovery

A common example occurs in Medicaid planning and eligibility when a person enters a nursing home and they’re relieved to find out they can keep their home (primary residence) because it’s a non-countable asset, which is true. However, most individuals are unaware that a  nursing home resident cannot continue to use their monthly income to maintain their home or pay for utilities because their income must be paid to the nursing home each month as previously discussed. On top of that, a Medicaid recipient and their loved ones also learn that a home and any other probate assets of the Medicaid recipient may be subject to Estate Recovery when the Medicaid recipient passes away. Probate assets of the decedent’s estate include assets that are only in the decedent’s name alone without a beneficiary designation.

Estate Recovery is a program administered by the Pennsylvania Department of Human Services that enables the state to be reimbursed up to the monetary amount that Medicaid paid toward the cost of a Medicaid recipient’s long-term care in a nursing home or the cost of using home and community-based services programs. The Estate Recovery Program applies to Medicaid recipients that are 55 years of age or older at the time they receive Medicaid. With that said, in some cases a Medicaid recipient’s home and other financial assets may not become subject to Estate Recovery. This may be accomplished by creating an individualized Medicaid plan that will protect these assets from the state by utilizing a few, little-known exceptions in the law.

How We Can Help

There are numerous opportunities, under the professional guidance and experience of the elder law attorneys at Zacharia Brown, to save money, protect a family home, and preserve life savings. Rather than depleting significant financial resources to pay for nursing home or in-home care costs, a far better choice is to retain Zacharia Brown as your legal advocate. They will guide you throughout the Medicaid eligibility and application process to ensure that you or a loved one will secure the long-term care that you need.