March, 2004

Medicaid 102

Let's say John and Susan have been married for a number of years.  John suffers from a variety of mental disorders, so Susan decides to put him in a nursing home.  Susan is now faced with the issue of having to qualify John, and herself in a sense, for Medicaid.  (In Massachusetts, we call Medicaid "MassHealth.")

Another way of asking "Do I qualify?" is: "What do I have to give up in order to get in?"  Answer: Almost all of your income and most of your property.  We'll look at income this month.

Let's say John did alright for himself back in the day, and now he brings in $5,000 per month between his pension ($2,000 p/mth) and some private investments he has ($3,000 p/mth).  Susan invested her money in the ponies and didn't fare as well.  She earns $500 a month in social security benefits. 

When John goes into the nursing home, he can keep $60 out of that $5,000 a month income.  So we better do something with the rest of that money or it becomes John's deductible, a $4,940 monthy co-pay if you will.

The good news is Susan is allowed a minimum monthly allowance of about $2,000.  Since she only rakes in $500 herself, she can take up to $1,500 a month from John to make up the difference.  The State also allows John to pay his health insurance premiums and other medical expenses before calculating his deductible.  But whatever is left after that is going to be lost each month to the nursing home. 

So what else can they do?  Susan can petition to have her minimum monthly allowance increased due to extraordinary circumstances (e.g. she herself lives in an assisted care facility).  Or she could have John transfer his investments to her so that $3,000 a month income becomes her income.  And since Susan's income is not considered in John's qualification process, Susan can now live off of $3,500 a month instead of just $2,000.  John will use his pension to pay for his health insurance, and the rest is paid to the nursing home.

How about this?  Susan divorces John and gets a Divorce Judgment ordering John to pay Susan alimony in the amount of $4,960 a month.  Could you do that if you were Susan?