Kiplinger’s Personal Finance: Couples can keep some assets while qualifying for Medicaid | Business News



Redistributing your assets can help you meet Medicaid’s standards.

The bill for long-term care adds up fast. The annual median cost for a private room in a nursing home was $105,850 in 2020, according to an annual survey by Genworth Financial.

The government could pick up these costs if you qualify for Medicaid, but that’s easier said than done. “Medicaid is a welfare program,” says Neel Shah, a certified financial planner in Monroe Township, N.J. “There are strict income and wealth limits to qualify.”

Medicaid should not be confused with Medicare, the national health insurance program for people age 65 and over that largely doesn’t cover long-term care. If you can pay for your own care, you’ll have more options as not all facilities accept Medicaid.

Still, even couples with ample savings risk impoverishing the other spouse to pay for a long stay in a nursing home. If that’s what you fear, you can preserve some assets for a spouse and qualify for Medicaid using tools designed for that purpose.

Although qualifications vary by state, your income generally must be less than $2,382 per month. You can allocate as much as $3,259.50 of your monthly income to a spouse, whose income isn’t considered, and still meet the Medicaid limit.

Your assets must be $2,000 or less, with a spouse allowed to keep up to $130,380.

Cash, bank accounts, real estate other than a primary residence, and investments, including those in an IRA or 401(k), all count as assets. But you may keep a personal residence; nonluxury personal belongings like clothes and home appliances,; one vehicle; engagement and wedding rings; and a prepaid burial plot.


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