Divorce and Medicaid – Part 1

Divorce rates in America have steadily risen for years and much has been written about it.  There are, however, many more couples in unhappy marriages who for varied reasons did not go the divorce route.  For some, it may have been about being more comfortable with the life they know vs. the uncertainty of a new life.  For others it may have been about the disappointment or anger of family and friends.  For still others it may have come down to finances.  Splitting the marital assets to pay for two separate households is  more expensive than for one and then there are the legal fees and court costs.

We see many of these couples call us when one of them needs long term care and the realization hits that the cost of that care could impact both of them.  Often the healthy spouse calling our office talks in terms similar to an ex-spouse as far as what is owned by each spouse. In their minds there are no longer marital assets.

Except that this really isn’t true if they are still married.  If they don’t have long term care insurance, then they will need to use those assets until they are spent down to the level of assets needed to qualify for Medicaid.  

“But, we’ve kept our finances separate for many years.  We have lived separate lives.  We just never went thru with a formal divorce,” they tell me.  Unfortunately, that likely wont’ matter to Medicaid.

Next week I’ll explain why.