Dear Attorney Tully: My wife is ill and will have to go into a nursing home in a few months. She has $43,000 in her name and I have $100,000 in my name. Can the state of Connecticut come after my money?
ANSWER: If your wife permanently enters a nursing home and applies for Medicaid (Title 19) assistance, the state Department of Social Services (DSS) will require a division of assets – a share for the community spouse (healthy spouse) and a share for the institutionalized spouse (ill spouse). DSS will count all of your assets and may not necessarily divide the assets in half.
Division of assets is the name commonly used for the Spousal Impoverishment provisions of the Medicare Catastrophic Act of 1988. It applies only to couples. The intent of the law was to change the eligibility requirements for Medicaid where one spouse needs nursing home care while the other spouse remains in the community, i.e. at home. The law, in effect, recognizes that it makes little sense to impoverish both spouses when only one needs to qualify for Medicaid assistance for nursing home care.
As a result of this recognition, division of assets was born. Basically, in a division of assets, the couple gathers all their countable assets together in a review. Exempt assets are not counted.
The countable assets are then divided in two, with the at-home or “community spouse” allowed to keep one half of all countable assets to a maximum of approximately $109,560. The other half of the countable assets must be “spent down” until less than $1,600 remains, in Connecticut. The amount of the countable assets which the at-home spouse gets to keep is called the Community Spouse Protected Allowance (CSPA). It is important to note that there are legal ways for couples to protect more than $109,560 with proper planning.
Connecticut also establishes a monthly income floor for the at-home spouse. This is called the Minimum Monthly Needs Allowance. This permits the community spouse to keep a minimum monthly income ranging from about $1,821.25 to $2,739.00. As with protecting more assets there are ways to protect more income.
If the community spouse does not have at least $1,821.25 in income, then he or she is allowed to take the income of the nursing home spouse in an amount large enough to reach the Minimum Monthly Maintenance Needs Allowance (i.e. up to at least $1,821.25). The nursing home spouse’s remaining income goes to the nursing home. This avoids the necessity, hopefully, for the at-home spouse to dip into savings each month, which would result in gradual impoverishment.