Too Much Income to Qualify for Medicaid?
Income & Nursing Home Medicaid
Families may find a loved one ineligible for Florida’s Medicaid nursing home program (ICP Medicaid) because he or she receives a certain amount of income. This post discusses solutions to enable one to become eligible despite having “too much income”, and how proper medicaid planning from an experienced elder law attorney can help.
For ICP Medicaid, an applicant’s gross Social Security, pension, and regular monthly income is typically what is considered to be countable income. Applicants, nursing home residents that are applying for services, are ineligible for ICP Medicaid if they are above the $2,205.00 gross monthly income cap (the 2017 cap). That is unless they take certain steps to become eligible.
These certain steps usually involve a Qualified Income Cap Trust a/k/a Irrevocable Income Cap Trust (“Trust”). When executed and administered correctly, this Trust will allow an applicant to qualify for Medicaid despite having monthly income that exceeds $2,205.00.
For example, a nursing home resident receives a Social Security benefit of $1,705.00 (before $104.90 of Medicare is withheld) and a pension of $1,000.00 for a total of $2,705.00 of gross monthly income. This individual is $500.00 over the income cap, and is ineligible, unless a Trust is executed and the Trustee deposits at least $500.00 into a Trust bank account on a monthly basis. In other words, the deposit into the Trust account “takes away” the excess income and allows one to become eligible.
As you can imagine, this is a life saver for many people that cannot afford a $7,000/month nursing home bill yet require such services. For the applicant in the example, while he or she may pay most income monthly to the nursing home, ICP Medicaid will pay the remaining costs of the nursing home and related services.
Income eligibility is very technical and any month in which the Trust (or a Pooled Trust) is not funded is a month where ineligibility may occur. If you need any assistance with this issue, or other ICP Medicaid questions in general, please contact an Elder Law Attorney with experience in Medicaid planning.