Current through September 24, 2024
A.
Effective October 1, 1989, eligibility can exist for an entire month when an
individual or couple, subject to liberalized resource policy, meets the
resource test during the month.
B.
The applicant is allowed to "spenddown" resources in a month to become eligible
for that month.
C. Under the
liberalized spenddown provisions, resources can be reduced within the
applicable limit and as long as resources remain within the limit for that
month, eligibility can be established. The following are considered in making
the determination:
1. Do not allow payment of
expenses that will be returned, refunded or reimbursed as legitimate spenddown
expenses when calculating resources for a given month. Client-owned resources
spent for reimbursable expenses count as an available resource in the month
paid.
2. Allow outstanding
checks/payments as an expense if proof is provided that the payment was
authorized during the spenddown month and the expense is
nonreimbursable.
3. The spenddown
provision implies that an individual spends down to the resource limit and
remains at or below the limit for the remainder of the month. When determining
eligibility for a prior period and reviewing the resource situation for a full
month, the individual or couple must have depleted resources to acceptable
level and remained eligible for that month for a true spenddown to have
occurred.
a) Example: An individual had $5,000
in a bank account on the first of the month and spent $3,000 on a pre-paid
burial contract on the 5th of the month. However, on
the 20th, he sold his car, which was excluded as a
resource for $2,500. The $2,500 then becomes a resource (conversion of a
resource) in the same month and unless the individual spends the excess $2,500
by the end of the month, eligibility cannot be established for that
month.
D.
Under liberalized resource policy, if excess liquid resources are earmarked for
payment of private pay expenses for month(s) prior to a month of Medicaid
eligibility, these excess resources can be excluded as a resource for any
potential Medicaid months since the funds are obligated. If Medicaid will cover
any months that have been paid as private pay by the client, the amount subject
to reimbursement is a resource in the month paid.
1. Example: A LTC applicant enters a nursing
home in June and applies for Medicaid in August. The applicant's bank account
is $6,000, but $4,500 is earmarked for private pay for June/July. Medicaid is
needed for August 1. Since the $4,500 is obligated for months prior to Medicaid
eligibility, it can be excluded as a resource in determining eligibility for
August forward, provided the earmarked funds are used to pay for the intended
private pay expenses.
E.
Under liberalized resource policy, income that accumulates while a Medicaid
application is in process and that is obligated for payment of Medicaid income
for months that will be covered by Medicaid can be excluded as a resource if
excess resources result from accumulating income.
1. Example: A LTC applicant enters a nursing
home in August and applies for Medicaid in October requesting benefits
retroactive to August. The client's income is $1,200 per month. In November
when the case is being worked up, the bank balance is $5,000. Medicaid Income
for September and October would be $2,312 ($1,200 - $44 = $1,156 x
2).
2. November's income of $1,200
can be backed out of the balance plus the $2,312 obligated for September and
October Medicaid Income, thus leaving $1,488 as a countable resource for
November.
Social Security Act
§1902 (r)(2); 42 CFR §435.601(b) (Rev
1994).
