How is" less than $2000. in assets" calculated for purposes of Medicaid?

Refunds of money spent are not income. But the sale of a car is. Don't ever let the bank account go over $2K, it creates problems. When you get close, buy some clothes, get a hair cut & color, maybe a new recliner. Go out to dinner. Put money in a burial fund.

My mom gets a annual dividend, to keep it from being a problem for Medicaid income cap for that month, it can be amortized for the year. Moms in TX, and amortizing can be routinely done for other items that pay a dividend or royalty - done all the time for oil, gas & mineral rights payments which are exempt assets. There's even a specific ? on O&G & Insurance income in the annual Medicaid renewal form. I don't know if other states do annual renewal like what TX does.

Thanks igloo. I'll ask about that. I have spoken with an Elder Care attorney a few times with various questions and hope he can help me more. I am awaiting a call today.

I have done a lot of reading on this and it's so complicated. I appreciate your info.

The following is from eldernet


Countable Assets

1. Cash.

2. Bank deposits.

"Bank deposits" include any savings, checking, term deposit ("CD") or other account of any kind in any financial institution. Money that is held jointly with another in a bank is treated as if all of it belongs to the applicant or his or her spouse, including money that has been set up as a trust account for someone else. The burden is on the applicant to prove that any funds in a joint account were not his or hers before they were put into the account.

3. IRA’s, Keogh plans, pension funds and annuities.

An "IRA" is an individual retirement account that you maintain at a bank under special rules that allow you to avoid income tax until you are retirement age. Tax laws impose a financial penalty for early withdrawal of IRA money, but this fact does not prevent such accounts from being considered countable assets under Medicaid rules.

A Keogh plan is like an IRA, but it is operated by your employer. Like an IRA, a Keogh incurs a financial penalty for early withdrawal, but this fact does not prevent it from being considered a countable asset under Medicaid rules.

Your pension fund is countable as an asset only to the extent that you have the right to remove the funds as a lump sum. If you do not have this right, your pension payment is income, but the fund itself is not a countable asset.

Like a pension, an annuity is countable only to the extent that you can remove the funds as a lump sum. Very few policies give you this right after they have begun to pay out monthly amounts, but you should read your policy carefully to see whether and to what extent it can be cashed out.

4. Securities.

"Securities" means stocks, bonds (including government bonds and Treasury bills), stock options, futures contracts, debentures, mutual funds, money market funds, promissory notes and other financial instruments of any kind.

Unlike bank accounts, jointly held securities are not presumed to belong entirely to the applicant or his or her spouse. Rather, they are presumed to be owned by those persons in whatever percentage appears on the ownership certificate. A different percentage of ownership may be accepted if the applicant can prove that the securities actually belong to someone else.

Securities that are traded publicly are valued as of the most recent closing bid price. Securities that cannot be traded are valued at whatever equity value they may have. If there is no market for a security and it has no equity value, or if it cannot be reached for some reason, it is not considered countable.

5. Cash surrender value ("CSV") of life insurance policies.

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Pleasant - for Tx the annual renewal letter comes in March or April for my mom who did her initial application in January. The first time I was totally unprepared and had no idea that a renewal was required & had to do a lot of scurrying about to get paperwork submitted for the initial application. For even more fun in this the Renewal letter was dated 2-7 days before it was mailed so always received after due date or right on or day before due date. This seems to be a continuous situation with TXDHHS related mailings.

Here is what TX wanted: current month and past 3 months before bank statements; current tax assessor statements on property; insurance policy details; current years awards letters from SSA and other income sources. Then a mutipage questionnaire. Within it you have to report any income or changes to the recipient since the initial Medicaid application.Alot of this is a restatement of items in the initial application. So for my mom, she gets an insurance policy dividend which I put in BUT amortized it for the year and put the monthly $ breakdown on the form. If there is still a home, there will be a separate "right to return" form sent to be completed afterwards - again has to be signed & returned in specific timeframe and again a lag in date of notice & actual mailing date. Check the renewal letter due dates, and if an issue, be sure to indicate that on the renewal form.

Now if within the review period they get $ that takes them over the asset ceiling or cap, you have to spend down before the EOM and get them under it. So that the following month they are under 2k, comprende? So you don't want to write a check that can take days to clear, but instead purchase whatever on a debit card so it gets taken immediately. You just need to make sure every month beginning & ending is under 2K to be all kum-by-ya for Medicaid.

Pleasant - Another item & ? for you -- you may find that now that she is on Medicaid, the other insurance may cancel or suspend her coverage. They aren't going to pay if Medicaid is paying. Medicare & Medicaid is now her insurers. So the deduction from her retirement for her insurance is going away and her actual,income increases so therefore her copay to the NH increases. You kinda need to find out if this is going to happen as if the insurer cancels, they can cancel back to day 1 of Medicaid coverage. Problematic!!M They will clawback payments to vendors they paid for services too. The vendors won't be happy as they have to refile for payment medicaid, which they may or may not take or may not be be happy with Medicaid's low rates. Clawback can take ages to happen too. vendor may not realize what happened till beyond the filing date and will be pretty peeved and can bill the person or their POA on this.....The Blues will clawback.

There is another poster on this site who routinely has to deal with insurance clawback issues within their practice - it puts everybody (family, health care providers, facility) in awkward (to say the least) situation while the insurers make out just dandy.

Assets are cash that is remaining after 30 days. So if a person has income and does not spend it all each month eventually the income will reach the $2000 limit. It is important to spend down to keep the cash assets below $2000. Income like rebates and the magazine refund is not considered income because it is not a regular amount. It is however considered an asset if it stays in the bank past 30 days. The Personal Needs Allowance should be used for things each month and if it is saved up can be contributed to the portion of the recipients debt.
Example: My dad had 45$ each month for personal needs when he was in a Nursing home. He didn't spend it so I gave it back to the Nursing Home toward his bill. If a person gets a one time deposit for expenses like Insurance, you must make that payment to the insurance within 30 days of recieving the income. If you hold the money longer than 30 days it is considered an asset.

That's good to know. I looked at a lot of documents online and nowhere did I see the them address Refunds of money spent. If that's the case, and it is not included as income, then is it counted as an asset? For example, what if recipient received refunds from various magazine subscriptions over the course of 12 months? Would they consider those funds in her bank account as an asset at all or is it all excluded as income and an asset? Thanks for responding.

When you say don't let it get over $2000.00 in her account, does that mean at once, or is it accumulative? Meaning, she just can't have more than $2000.00 at one time?

My MIL has only been on Medicaid since November 2014 , and we now have questions of what is allowed for assets besides the under $2000.00 in her account.
For instance once a year in January she receives a lump some payment of $1800.00 by auto deposit from her pension plan to cover the cost for health insurance that was taken away from retirees years ago.. She is responsible to buy and pay her own health insurance and does so by auto deduct monthly.
Is it allowed to have more money in her account if proof is shown what the extra funds are for? Or can a separate account be set up to pay for the insurance to be deducted from. My BIL has POA and is looking into it to see if it can be paid in one lump sum also. I'm afraid that mom having more in her account will get her disqualified possibly.
One more question. How often do they check or ask for proof on account balances. I would hate for us to have to qualify and restart the application process again.
Thanks in advance for your answers.

Thanks Ladylee, so based on what you are saying (And this is exactly what I need to know.) if recipient gets a $200.00 check in inheritance funds, as long as she applies it to her county tax within 30 days, it's okay?

Sunnygirl, if she is already on Medicaid, she has to notify them of this additional income. Don't confuse existing assets with additional income.