Eligibility for Title 19 Medicaid Assistance
Financial Assistance for Nursing Home Care in Wisconsin
Title 19 (also referred to as "Medical Assistance" or "Medicaid") is a joint federal-state welfare program which provides funding to cover the costs of nursing home care for individuals who meet certain income and asset requirements. Because the rules governing the program vary from state to state and are very complex, anyone thinking about planning for Title 19 eligibility or applying for Title 19 benefits should seek professional advice tailored to their unique situation.
To qualify for Title 19 benefits, anyone applying to the program must meet certain asset limit requirements. To determine whether an applicant satisfies these requirements, the law requires an asset assessment or “snapshot” as of the day an individual enters a medical institution. For a single person, the asset limit is $2,000 in “countable” assets. Spousal impoverishment allows a couple to keep part of their countable assets and still be eligible for Title 19. For 2012, the Title 19 asset limit for a couple will be $2,000 plus one-half of the “snapshot” assets, but no less than $50,000 and no more than $113,640.
A married person with “snapshot” assets between $0 and $52,000 when he or she enters an institution will be Title 19 eligible immediately. A married person with “snapshot” assets between $52,000 and $100,000 will be Title 19 eligible when countable assets are at $52,000. A married person with “snapshot” assets between $100,000 and $227,280 will be eligible when countable assets are below one-half the value of the “snapshot” assets plus $2,000. A married person with “snapshot” assets of $227,280 or more will be Title 19 eligible when countable assets are below $115,640.
Certain assets are exempt, or not treated as “countable” assets. The most common are:
- Homestead: A homestead of any value, if a spouse, minor children or “dependent relative” lives in it, or if the individual entering the nursing home intends to return home. The home equity exemption is limited, however, to $750,000. The limitation does not apply if the community spouse, a minor child, or a blind or disabled adult child is “lawfully residing” in the home.
- Auto: One automobile per household is excluded regardless of the value if it is used for transportation of the eligible individual/couple or a member of the eligible individual’s/couple’s household.
- Household and personal possessions: Possessions of a reasonable value for a single person; no limit on value for a married person.
- Burial arrangements: Irrevocable burial trust (up to $3,000) plus prepayment of casket, vault, opening and closing of grave, etc., up to any value, or an insurance-funded burial contract up to any value. If married, both spouses may own burial arrangements.
- Life Insurance: $1,500 face value policy. If married, each spouse may own $1,500 face value life insurance. If face value is above $1,500, cash value is treated as a countable asset.
* Certain other assets are not counted, either temporarily or permanently, because they are “unavailable”, i.e., can’t be converted into cash.
For a single person on Title 19, all of his or her income (except a $45 per month “personal allowance” and enough money to pay for private health insurance) will usually be paid to the nursing home for care. However, if a doctor certifies that the person is likely to return home, the person may keep a limited amount of additional income to maintain the home.
A married person may allocate income to the spouse still residing in the community to bring his or her income up to the lesser of $2,841.67 or $2,451.67 plus “excess shelter allowances” (i.e., expenses for rent, mortgage principal and interest, taxes and insurance for residence, maintenance fee and food stamp standard utility allowance) over $735.50 per month.
A married person may allocate income to a dependent child (i.e., a child under 18 or claimed as a dependent on taxes) or other dependent family member to bring the dependent’s income up to $612.92 per month.
For married people, it may be possible to increase the amount of assets the community spouse may have if those assets are necessary to generate income to bring the community spouse’s income up to the income allocation limit.
After the institutionalized spouse is on Title 19, the community spouse may accumulate assets above the asset limit. He or she may save, sell exempt assets, inherit money, etc., without affecting the institutionalized spouse’s eligibility.
Some transfers cause no Title 19 ineligibility because they are specifically allowed under Title 19 rules. These include:
- All transfers to or for the sole benefit of a spouse.
- All transfers to or for the sole benefit of a disabled child.
- Transfer of a home to:
- a child under 21
- a child of any age who has lived there for two years and provided care which delayed institutionalization.
- a sibling who has lived there for one year and has an equity interest.
Planning Options/Deficit Reduction Act
There are still planning opportunities under the new law. However, this planning requires extreme care. There are risks in all planning for Title 19. It is important to get personal, professional advice before any gifts or transfers are made.
Long-term care insurance is appropriate advance planning for some, as is “advance benefit” life insurance. In addition, the purchase of long-term care insurance may increase the amount of assets that may be protected from nursing home costs.
A thorough General Durable Power of Attorney is essential. This should be prepared by an attorney.
The Deficit Reduction Act of 2005 (“DRA”) was signed by President Bush on February 8, 2006, and took effect in Wisconsin as of January 1, 2009. The DRA made dramatic changes to the Title 19 program. For example, the 36-month look-back period is changed to 60 months and the period of ineligibility does not commence until an individual applies for Title 19.
The new law changes the impact of gifts made within 5 years of applying for Title 19. You should consult legal counsel to implement a plan prior to making any gifts.
Liens and Claims Against Estates
The state may put a lien on the homestead property of a nursing home Title 19 recipient, but only if it is not occupied by a spouse, disabled child or child under 21 years of age, or sibling with an ownership interest who has lived there for 12 months.
The state may make a claim against the probate estate of a nursing home Title 19 recipient.
LIMITATIONS AND DISCLAIMER
This brochure is in no way intended to be a complete explanation of the laws affecting Title 19. The laws often change and each individual’s situation is unique. The assets and income limits change each year. This brochure will provide an initial understanding of the basic concepts. You should carefully evaluate your particular situation and consult the appropriate legal advisor prior to taking any action.