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Making Sure the Community Spouse has Enough Income to Live On

Effective January 1, 2016, the community spouse Minimum Monthly Maintenance Needs Allowance (“MMMNA”) will remain the same as in 2015 — $2,980.50. As, discussed in previous postings, the MMMNA is the amount that is set to make sure the healthy spouse has enough monthly income to continue to live in the community. Additionally, if the well (or community) spouse’s income falls below $2,980.50 per month the difference can be made from the income of the spouse in the nursing home if it exists.

Also discussed in previous postings, the maximum Community Spouse Resource Allowance (“CSRA”) will remain the same as in 2015 — $119,200.00. The spouse that enters the nursing home is permitted to keep assets that do not exceed $14,850.00. The healthy spouse is allowed to retain assets (excluding the primary residence) that do not exceed the CSRA.

If the community spouse establishes that income generated by the CSRA is inadequate to raise the community spouse’s income to the MMMNA, the department must establish a resource allowance adequate to provide such MMMNA from those resources considered to be available to the institutionalized spouse.

Example: Kelly and Patrick of Kings Park, NY are married and they have resources (assets) of $300,000.00. Kelly’s income is $500.00 per month and Patrick’s income is $600.00 per month. Patrick entered the nursing home at the end of May 2015. On June 20, 2015 a Medicaid application was made. After subtracting $50.00 per month for his personal needs account, Patrick’s excess income will be added to Kelly’s income resulting in a total monthly income of $1,050.00. Clearly, this monthly income is well below the MMMNA of $2980.50 per month. After subtracting the $119,200.00 CSRA and the $14,850.00 permitted resources of Patrick, Kelly will be allowed to keep assets greater than the CSRA to generate sufficient income to raise her to the MMMNA. Federal guidelines provide that “States may use any reasonable method for determining the amount of resources necessary to generate income, including adjusting the CSRA to the amount a person would have to invest in a single premium annuity to generate the needed income, attributing a rate of return based on a presumed available rate of interest, or other methods”. i

To be continued ….
Aaron E. Futterman, CPA, Esq. is a partner in the law firm of Futterman & Lanza, LLP with offices in Smithtown, NY and clients throughout Suffolk, Nassau, Queens, Brooklyn, Bronx, Richmond, New York, Westchester and Rockland Counties. He concentrates his practice to Elder Law, Medicaid Planning, Medicaid Applications, Estate Planning, Probate, Estate Taxes, and Estate Administration.

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