On August 5, 2014, Medicaid issued a new General Information System (“GIS 14 MA/15″) stating that “spousal impoverishment with post-eligibility rules must be used when determining income and resource eligibility for married couples with a spouse receiving HCBS (Home & Community Based Services) waiver services or with a spouse enrolled in a MLTC (Managed Long Term Care) plan.” This means that rules that were meant to level the playing field for married couples with lower incomes, when one spouse is receiving home care services, are now eliminating the use of a pooled income trust to protect the income of these couples. While some married couples will not be adversely affected, those earning more than $3,314 per month will be disadvantaged by this new rule. This GIS became effective as of January 1, 2014.
On March 23, 2010, the Patient Protection and Affordable Care Act (also known as “Obamacare” or the “Affordable Care Act”) became effective. Within it, there are provisions designed to afford the same protections of spousal impoverishment that lower income married couples with a spouse residing in a nursing home have, to lower income married couples with a spouse at home receiving home care services provided by a MLTC or receiving other waiver services (“Medicaid recipient ”).
Spousal impoverishment in a nursing home setting allows the well spouse to keep the MMMNA (“Minimum Monthly Maintenance Needs Allowance”) income amount, currently $2,931 plus the cost of their health insurance, while the nursing home resident is allowed to keep $50 of his/her income plus the cost of health insurance. If the well spouse’s monthly income is below the MMMNA amount, then Medicaid allows him/her to keep so much of the income of the spouse residing in the nursing home as will allow the well spouse to have the MMMNA amount. If the well spouse has income over the MMMNA maximum, then he/she is allowed to keep the MMMNA amount, and must contribute 25% of their income over such amount. For example, if the well spouse has $3,931 in monthly income, then he/she must contribute $250 per month towards the care of the spouse in the nursing home.
In the home care situation, the well spouse would be able to have their spouse receiving MLTC home care services or waiver services, contribute the needed additional income to bring the well spouse’s income up to the current maximum of $2,931 while the Medicaid recipient would be allowed to keep $383 per month. For a married couple with a combined monthly income of $3,314 or less, these rules are advantageous.
Under the Patient Protection and Affordable Care Act prior to August 5, 2014, married couples with one spouse receiving MLTC home care services or waiver services were allowed to choose either spousal impoverishment rules or the use of a pooled income trust for the spouse receiving services. Now, however, all married couples who have a spouse receiving MLTC home care services or waiver services must utilize spousal impoverishment when calculating their income. For married couples where the well spouse has over the current maximum of $2,931, then they are allowed to keep the $2,931 and are expected to contribute 25% of their income over the allowed $2,931. The Medicaid recipient receiving MLTC home care services or waiver services is only allowed to keep $383 per month and contribute all of their income above that amount to Medicaid. The Medicaid recipient previously was allowed to keep $829 per month and deposit their income above that amount into a pooled income trust to be used to pay monthly expenses on their behalf. It appears that the new GIS denies Medicaid recipients the opportunity to utilize pooled income trusts.
Simply stated, married couples are being treated differently from single persons receiving MLTC home care services or waiver services. While a single individual Medicaid recipient can keep $829 a month plus deposit their income above that amount into a pooled income trust to be used to pay monthly expenses on their behalf, no matter how large the excess income amount, married Medicaid recipients are now denied the opportunity to put their excess income into a pooled income trust.
Here are a couple of examples of how spousal impoverishment affects married couples differently:
1. Husband needs Medicaid home care services from a MLTC. Wife is retired from part-time job. Here is an example of where spousal impoverishment would benefit the couple.
Husband’s Income Wife’s Income
Social Security $1,200 Social Security $850
Pension $ 950 Pension $300
Total Income $ 2,150 Total $1,150
Less allowance <$ 383>
Excess Income $ 1,767
MMMNA Amount $ 2,931
Wife’s Total Income <$ 1,150>
Difference $ 1,781
In this case, the husband will give his wife his excess income ($1,767) to help bring her income closer to the MMMNA amount of $2,931, and receive Medicaid services.
2. Husband needs Medicaid home care services from a MLTC. Wife still works. Here is an example of where spousal impoverishment would disadvantage the couple.
Husband’s Income Wife’s income
Social Security $ 2,211 Social Security $ 2,291
Less allowance <$ 383> Salary $ 4,060
Excess Income $ 1,828 Sub-Total $ 6,351
Less MMMNA <$ 2,931>
Excess Income $3,420
Amount of Excess Income
to be contributed (25%) = $855
$1,828 Husband’s Contribution
+ $ 855 Wife’s Contribution
$2,683 Total Contribution to MLTC
As a single Medicaid recipient, this applicant would have been able to keep $829 per month and contribute the excess income of $1,382 ($2,211 – $829) to a pooled income trust, and then spend it on his monthly expenses such as food, rent, etc., and still receive Medicaid services.