Community Medicaid Cases and Spousal Impoverishment
Frequently, a married couple struggles with the questions of when to apply for Medicaid. It is too soon if the disabled spouse is still at home, but suffering from a decline in the ability to handle activities of daily living? Department on Aging "Community Care" (Meals on Wheels, bathing, cleaning, at home nursing care, etc), usually is limited to a few hours a day. What else is there?
Recently, a worker with one of the local Area Agencies on Aging pointed out to a client that the nursing home application could be filled out even though the disabled spouse was still at home. To the client, this appeared to mean doing the Medicaid paperwork ahead of time, but little else.
When this office was asked for advice, we learned that the healthy spouse and the disabled spouse combined have income well above the $2,175.00 a month income allowance (but assets below the $87,000.00 asset allowance). This, in a nursing home setting, clearly would mean either a support payment, or a copayment, or both, with a significant reduction in income to the healthy spouse as a result. What wasn't clear at the time was how this would affect community Medicaid payments to the disabled spouse.
We then contacted Policy within Public Aid, and were informed that the Federal Medicaid statute contains the same spousal impoverishment protections for community Medicaid recipients where incomes (or assets) exceed the allowable maximum. In other words, seeking court protection would be a possible remedy to protect excess spousal assets or income in an appropriate case.
As a consequence of this, we prepared a petition in chancery to obtain an increase in the spousal income allowance for the healthy spouse. In the law, this is based on the disabled spouse being an "institutionalized spouse" within the meaning of the Federal Medicaid statute. Specific legal citations for this include 42 U.S.C.A. section 1396r-5(h) and section 1396a(a)(10)A)(II)(VI).
The practical meaning of this goes beyond this one client's situation. Many married couples may be facing impoverishment even before nursing home admission. Until Medicare starts paying for prescription drugs, this is one major health item that Medicaid might provide to key to obtaining payment. This might also be of importance to the client who is underinsured altogether. Furthermore, this gets the individual into the system at a time when perhaps the pressure and trauma involved is less than if the application process is delayed.
Time will tell whether community Medicaid cases will grow in terms of importance for elder law Medicaid practitioners. For now, suffice to say that it is an area to consider in any counseling session involving the same or similar facts as those presented above.