This is another installment in our series on Medi-Cal planning. We are focusing on the income requirements for Medi-Cal eligibility. In our last blog post we discussed income in the context of in-home care. Here we look at nursing home care.
Nursing Home Medi-Cal
The income calculation for nursing home Medi-Cal is slightly different from in-home Medi-Cal. There is almost always a Share of Costs, especially for unmarried people. For the Medi-Cal applicant in a nursing home the income calculation is fairly simple:
Not Married
Applicant’s gross monthly income from all sources
-Monthly Needs Allowances $35
-Medical expenses not covered by Medi-Cal
=Share of Costs
The Monthly Needs Allowance of $35 is money the Medi-Cal recipient can keep every month to spend as desired. If Share of Costs is less than the Medi-Cal nursing home payment the Medi-Cal applicant meets the income requirements.
Married
When one spouse is applying for nursing home Medi-Cal, the other spouse, called the “Community Spouse,” is entitled to a certain amount of income, a Minimum Monthly Maintenance Needs Allowance (MMMNA), if the couple has enough income. That amount in 2018 is $3,090. In the nursing home context only the income of the community spouse is not otherwise counted when determining eligibility. An example: Wendy and Henry are retired. Wendy’s income is $1,300 per month, Henry’s is $1,750. They each pay Medicare Part B of $134. Henry is in a nursing home and therefore the Medi-Cal applicant.
Henry’s gross income = $1,750
-Health insurance premium $134
-Monthly Needs Allowance $35
=Share of Costs $1,581
Henry’s Share of Costs would be $1,581. Wendy’s income does not factor into Henry’s Share of Costs. However, Wendy’s income is only $1,300 per month, which is less than her $3,090 MMMNA. Medi-Cal will permit Henry to give up to $1,790 per month from his income to Wendy in order to bring her income up to the MMMNA. However, Henry only has $1,581 in income after his allowable deductions. All of that will go to Wendy, reducing Henry’s Share of Costs to $0.
This will provide Wendy with $2,881 per month in monthly income, which is less than her MMMNA of $3,090. It might be possible to do some planning with the couple’s assets to increase Wendy’s monthly income by the difference of $209. We will discuss that in a future post.
[Ad] Walnut Creek Area neighbors! The time is now to protect yourself, your family, and the assets you’ve worked so hard for. If you don’t have an estate plan in place or need help updating the one you already have, we can help. California law is our specialty, and we will make sure you and your loved ones are prepared for the future starting now. If you have questions about our services or the content in this blog, please don’t hesitate to contact our team by calling 925.943.2740 or by sending an email to info@absolutetrustcounsel.com. Or, if you’re ready to get started, get your discovery call on the books by visiting our calendar to pick a date and time that works for you. We can’t wait to speak with you.
If you’re someone who needs to include Medi-Cal planning in your estate plan, we can help. For more information on what Medi-Cal planning should look like, visit https://absolutetrustcounsel.com/practice-areas/medi-cal-planning/ for even more resources to help get you started.