Reporting a Financial Change to Existing Medicaid Benefits
Sale of a Vehicle or Home:
Impact: The proceeds from selling a vehicle or home are considered countable assets.
Consequence: If the sale proceeds exceed the asset limit, you may become ineligible for Medicaid. You will need to spend down the excess funds on allowable expenses to regain or maintain your eligibility.
Death of the Community Spouse:
Impact: The death of a spouse can lead to changes in income and assets. For example, you might receive life insurance payouts, survivor benefits, or inherit your spouse’s assets.
Consequence: These changes can increase your countable income and assets, potentially making you ineligible for Medicaid until the excess assets are spent down.
Gifting:
Impact: Giving away assets can trigger a penalty period under Medicaid’s look-back rule, which examines asset transfers made within a specified period.
Consequence: If you are found to have given away assets while on Medicaid, you could face a penalty period during which you are ineligible for benefits.
Reporting a Financial Change
Inheritance
Impact:
Receiving an inheritance can increase your total assets, potentially pushing you above the asset limit for Medicaid eligibility.
Consequence:
If the inherited amount exceeds the state’s asset limit, you could lose your Medicaid benefits until you spend down the excess assets in compliance with Medicaid rules.
Increase in Income
Impact:
An increase in income from sources such as employment, pensions, or other income streams can affect your eligibility if it exceeds Medicaid’s income limits.
Consequence:
If your income exceeds the limit, you may lose your Medicaid benefits. Some states have spend-down programs that allow you to qualify by subtracting medical expenses from your income, but this can be complex to manage.
Mitigation Strategies
Spend-Down: Use excess assets to pay for allowable expenses such as medical/facility bills, home improvements, or purchasing exempt assets.
Medicaid-Compliant Strategies: Establishing strategies that comply with Medicaid rules can help protect assets while maintaining eligibility. Our Certified Medicaid Planners can help navigate complex rules and develop strategies to manage financial changes for you.
By understanding how these financial changes impact Medicaid eligibility, you can take proactive steps to manage your finances and maintain your benefits. Contact Medicaid Planning Consultants today!