Getting and Keeping Medicaid – Part 1

                In this week’s post I focus back on Medicaid.  As I often tell people, every year it seems that securing Medicaid approvalsis increasingly difficult.  There are more ways to be tripped up by the complex and often confusing rules and regulations.  Many of the problems stem from keeping Medicaid eligibility after it has been achieved.

                For example, in order to be eligible for Medicaid in a single applicant case, assets must be spent down to less than $2000 by the last day of the month directly preceding the month the applicant is requesting as the start date for Medicaid, but that only insures Medicaid for one month.  In order to be eligible each and every month thereafter, the applicant must remain under $2000 by the end of every month moving forward.

                In other words, if we want Medicaid to begin 4/1 we must be spent down under $2000 by the end of the day on 3/31, however, if on 4/30 the balance goes over $2000 then the applicant will be ineligible for May.  In that case all that is achieved is one month of eligibility which is then lost the next month.  Despite repeating this point early and often, I occasionally find families “ease off” after initial spend down has been reached.

                I can certainly understand why.  It can be exhausting gathering the necessary information and documentation and carrying out a flurry of transactions in the final month before Medicaid eligibility.  The natural tendency is to take a deep breath and “take your foot off the pedal”.  With Medicaid, however, that can be big mistake.  Maintaining Medicaid eligibility requires consistent vigilance.

                So, how can one be under $2000 on 3/31 and then back over $2000 on 4/30?  The cause is the applicant’s income from Social Security and pension every month.  I constantly remind families that the income must not remain in the applicant’s account by the end of the month it is received.  It must be given over to the facility.  Otherwise, after 1 or 2 months (depending on how much income is received), if the income is accumulating it will push the asset total back over $2000.

                Once Medicaid is approved renewal of benefits, which happens annually, can create other pitfalls for Medicaid recipients who can lose benefits that worked hard to obtain.  5 years ago this was less common simply because New Jersey was lax about conducting annual redeterminations.  In the last several years, however, annual Medicaid redeterminations are routine and we are finding that families are running into problems in keeping Medicaid.  Next week I’ll explain.