Because our firm practices in both New York and New Jersey, I thought we would share some of the main differences in Medicaid rules between the states where Medicaid is applied for to cover long term care services. Each State’s Medicaid Offices treat many important issues differently.
Topic One
Does Spousal Refusal Work?
New York: Yes. A spouse who lives in the community can have assets in excess of the applicable resource cap, execute a document that confirms that the community spouse will not make her assets available to pay for the ill spouse’s care and the assets of the community spouse are not counted. However, while this sounds favorable, the Medicaid office may pursue reimbursement against the community spouse.
New Jersey: No. While Spousal Refusal is on the books, it is not allowed to be used except in certain circumstances. As such, once a snapshot is taken of the spouses’ combined assets, the assets are gifted to the community spouse and the community spouse is normally required to annuitize the excess assets into an income stream. While this is more restrictive than NY, once the annuity is done, Medicaid cannot sue the spouse for reimbursement.
Topic Two
Are Retirement Accounts Exempt from Medicaid Eligibility?
New York: Yes. If the IRA owner is taking minimum distributions pursuant to the IRS rules, the principal balance of the IRA is exempt.
New Jersey: No. The entire IRA balance is a countable asset and must be either annuitized or cashed out (neither are good options).
Topic Three
Is there a 5 year lookback period applied for gifts for long term care services covered by Medicaid?
New York: Yes for nursing home Medicaid. But no look back for Medicaid that covers home-based care.
New Jersey: Yes there is a look back period for all long term care services.
Disclaimer
This is general information. It is not intended to be legal advice to be relied upon by any person who is reading this Blog nor is it intended to create a lawyer-client relationship. If you have any questions, you are free to contact our office.