Settlement Of Large Community Spouse Asset Allowance In Cook County Adult Guardianship Case
As many of you know, a healthy spouse gets to keep $87,000.00 in non-exempt assets, plus $2,103.00 a month of income, plus the homestead, generally without a lot of fanfare or difficulty. On February 8, 2001 the Honorable Judge Richard E. Dowdle signed "Agreed Order Authorizing The Guardian To Transfer the Homestead And Liquid Assets Of the Nursing Home Spouse In Excess Of the Medicaid Community Spouse Asset Allowance With the Nursing Home Spouse's Income (Less Appropriate Credits) Being Applied Toward the Medicaid Group Care Credit".
The order said that certain assets transferred to the wife could remain in her name without affecting the husband's Medicaid eligibility. These included Linsco Private Ledger ($103,523.50), Dean Witter Investment Account ($40,000.00) and Lincoln National Brokerage Account ($209,000.00), therefore totaling over $340,000.00.
General Counsel and the Attorney General were initially inclined to oppose the petition just based on the large amount of assets being diverted to the wife. However, in negotiation discussions, we pointed out a mitigating (though not necessarily provable) factor being that these funds had many years ago been inherited by the wife. Opposing counsel saw this as being somewhat helpful to our cause, but not enough so to overcome the unusually large amount of assets being diverted. As a result, both sides came to a compromise where the husband's separate income would go to the nursing home rather than the wife, but the wife would be allowed to keep all of the transferred assets, and be allowed to divest the husband in addition down to the $2,000.00 asset disregard that the husband is allowed and still be able to be approved for Medicaid.
Obviously, both sides approached this case cautiously. Neither side wanted a precedent that would hurt its posture for future community spouse cases. As a bonus, the client was quite happy with the outcome.