Paying for Nursing Home Care with Medicaid (Title 19)

July 2007

About this pamphlet...
What is Medicaid or Title 19?
What assets can I have and still qualify for Medicaid to pay for my nursing home care?
What about my house?
If I am married and need to go to a nursing facility, may my spouse at home keep any of our savings or other assets?
Can I transfer or give away my assets or property?
What happens to my monthly income if I am in a nursing home?
How may my spouse at home get more of my income?
Does my spouse have to pay for my nursing home care from his or her income?
How do I apply for Medicaid?
For more information

About this pamphlet...

This pamphlet gives an overview of Medicaid (or "Title 19") rules for people who need help paying for nursing home care. It talks about what assets, property and income a person can keep and still be eligible for Medicaid to pay the nursing home bill. It also gives information for married couples when one spouse needs nursing home care and the other spouse remains at home trying to make ends meet.

Medicaid rules are very complex and change from time to time. Certain dollar amounts in this pamphlet also change from time to time. You should not try to use the rules or rights explained here without first checking with a legal aid or private attorney who is knowledgeable in Medicaid law.

What is Medicaid or Title 19?

Medicaid (or Title 19) is a program of medical assistance provided through Connecticut's Department of Social Services (DSS). This program pays medical bills for certain categories of people whose income and assets are too low to cover their medical bills.

Medicaid has different rules for different types of people, including: persons aged 65 or older, disabled persons, children under 21, certain families, and persons in nursing homes.

This pamphlet discusses Medicaid rules only for people who need nursing home care. Different rules apply to other people, such as younger disabled individuals who need Medicaid home care services. For more information, consult an attorney with knowledge of Medicaid law.

Medicaid rules in Connecticut may be different from those in another state. If you are concerned about someone needing nursing home care in another state, you need to check that state's rules. Also: Do not confuse Medicaid with Medicare, an entirely different program. Medicare is a medical insurance program run by the federal government for certain people who get Social Security or Railroad Retirement benefits. Medicare pays only limited nursing home benefits under strict rules.

For more information about Medicare, call the Center for Medicare Advocacy (1-800-262-4414). Call Statewide Legal Services (1-800-453-3320) or your local Legal Aid office for a copy of our brochure,  Are You Considering Nursing Facility Care.

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What does Medicaid pay for?

In Connecticut, Medicaid covers a broad range of medical services. For a nursing home resident, Medicaid will pay for semi-private room and board, doctor's visits, some prescription drugs and other medication, hospitalization, laboratory tests and x-rays, physical therapy, medical equipment like wheelchairs, some dental needs, hearing aids, eyeglasses and most other medical expenses.

What assets can I have and still qualify for Medicaid to pay for my nursing home care?

You can keep certain assets and still qualify for Medicaid.  Assets are things like cash, bank accounts, stocks, bonds, etc.  For information about your home, see below. Also see our brochure, Your Home and Title 19.

In Connecticut, an individual may have no more than $1600 in countable assets, PLUS the following assets, and still qualify for Medicaid in a nursing home:

• A burial plot of unlimited value.  A burial plot may also include the purchase of a grave site, opening and closing of a grave site, cremation urn, casket, outer burial container, a headstone or marker, crypt or mausoleum.
• A pre-paid irrevocable (non-refundable) funeral contract (limited to $5400 with a Connecticut funeral home); or a refundable funeral contract for up to $1800 ($1500 for married persons).
• Term life insurance -- no cash surrender value.
• Cash value life insurance if the face value of all cash value policies is $1500 or less.
• Long-term care insurance payments made from a Connecticut Partnership for Long-Term Care approved insurance policy may allow you to protect additional assets. Be sure to inform the DSS caseworker of any Connecticut Partnership Long-Term Care insurance you have when applying for Medicaid. (For information on the Connecticut Partnership, call DSS at 1-800-547-3443 or visit the CT Partnership website. 

Important: See below for information about how a married applicant's assets are treated.

What about my house?

If you go into a nursing home and need Medicaid, your house is not counted as an asset if you intend or are expected to return home. For example, if you break a hip and need to stay for a short time in a nursing home to get well, your house should not count for Medicaid purposes. You would not have to sell the house, and the state would not put a lien on it.

If you go into a nursing home and do not expect or intend to return home, the house is still not counted for Medicaid if any of these people live in it:

• Your spouse;
• A child under 21;
• An adult blind or disabled child; or
• A brother or sister who also partly owns the house and has lived there for at least one year before you went into a nursing home.

Any of these people will be able to stay in the house and the state will not place a lien on the house or require you to sell it.

However, if none of these people lives in your house, and you do not expect or intend to leave the nursing home, you will be required to sell your house for fair market value.  As long as you are making a good-faith effort to sell your house, its value will not be counted for Medicaid purposes.  The state puts a lien on the house while you are trying to sell it.

When the house is sold, DSS takes from the proceeds of the sale what it has paid for you in the nursing home up to that time. You will then go off Medicaid until you have spent the rest of the money from the sale of the house and have no more than $1600 in total assets. For more information, see our brochure Your Home and Title 19.

NOTE: The recent enactment of a new federal law, The Deficit Reduction Act of 2005 (“DRA”), has allowed Connecticut to place a $750,000 limit on an individual’s equity interest in the individual’s home. The limit does not apply if the Medicaid recipient’s spouse, child under 21, or adult blind or disabled child, lives in the home. The DRA does allow an individual to reduce his or her home equity interest without penalty through reverse mortgage or home equity loan. However, there will be a penalty if the equity interest proceeds are given away.  

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If I am married and need to go to a nursing facility, may my spouse at home keep any of our savings or other assets?

Special rules protect the spouses of those who need nursing home care paid for by Medicaid. In most cases, the amount of assets your spouse at home (also called the "community spouse") can keep is based on how much you both had when you first went into a nursing home (or hospital, or began receiving certain home care services).

Generally, the community spouse will be allowed to keep at least one-half of these total assets. However, this amount cannot be more than $101,640* (even if one-half of your assets is more than that) or less than $20,328* (even if one-half of your assets is less than that amount).  [*effective January 1, 2007 - December 31, 2007.  These amounts change each January.]

Important Information for Married Couples:  It is possible for the community spouse to keep more than one-half of these total assets but only if the nursing home spouse's income is not enough to give the community spouse the amount of monthly income he or she is entitled to by law (see income below).

In addition to a share of assets, the community spouse can have a car, certain burial arrangements, and your home (regardless of your equity interest in it). Please see information about monthly income below.

You and your spouse may be able to keep additional assets if you have a Connecticut Partnership for Long-Term Care approved insurance policy that has paid benefits. Be sure to mention any Connecticut Partnership for Long-Term Care insurance you have when applying for Medicaid (see information on assets above).

When you apply for Medicaid you should ask DSS to do a "spousal assessment". This assessment will tell the amount of money DSS thinks the community spouse will be able to keep. If your spouse needs more money than DSS allowed, you should challenge that decision by requesting a hearing.

IMPORTANT:   You or your spouse may ask for a "Fair Hearing" to increase the assets or income for the community spouse. If you receive a "Spousal Assessment" before applying for Medicaid, you must file a hearing request within 60 days of the spousal assessment notice from DSS.   If DSS determines the amount of assets or income for the community spouse as part of an application for Medicaid, you must file the hearing request within 60 days of the application determination notice from DSS.  It is often very beneficial to have a knowledgeable attorney or other advocate with you at the Fair Hearing.  

Can I transfer or give away my assets or property?

IMPORTANT: Certain penalties may apply to transfers of assets for less than fair market value. Before making any transfers, you should check with an attorney with knowledge of Medicaid law to see what planning is best for you.

When you need Medicaid in a nursing home, DSS can "look back" over the past thirty-six (36) months to see whether you intentionally gave away money or property to become eligible for Medicaid. Under the new federal law (the DRA), starting on February 8, 2009, the look-back period will increase each month until it reaches 60 months on February 7, 2011.

LOOK-BACK PERIOD RULES

The DRA has changed the look-back period rules:

• If you apply for Medicaid BEFORE February 8, 2009, your look back period will be 36 months (3 years).  This means you only need to show DSS 36 months of your financial records.
• If you apply for Medicaid AFTER February 8, 2009, your look-back period will be longer than 36 months.  The look-back period will grow each month until it reaches 60 months (5 years) on February 7, 2011. 

As you can see, Medicaid rules are very complicated. Please talk with a legal aid or private attorney who knows Medicaid law.

DSS can also ask about certain transfers your spouse may have made, even though your spouse doesn't need Medicaid.

Caution about Trusts: Medicaid has complicated rules regarding trusts. Some transfers to or from a trust are subject to a 60 month (5-year) look-back period. Some transfers to a trust for disabled individuals are permitted.  You should consult with an attorney who has expertise in Medicaid law before establishing any trust or applying for Medicaid if you have a trust fund.

If DSS decides that you or your spouse gave away money or property for less than market value (also known as a "gift"), you may not be able to get Medicaid to pay for nursing home care for a certain length of time (known as a "penalty period").   DSS uses a formula to decide how many months you will not be eligible for long-term care facility benefits paid by Medicaid.  The formula is based on the amount of the gift and the average monthly cost of nursing home care in Connecticut.

PENALTY PERIOD RULES

The DRA has drastically changed the penalty period rules:

• For gifts (transfers) made BEFORE February 8, 2006 (the enactment date of the DRA), the penalty period started the month you made the gift (transfer). As a result, the penalty period may have ended before you applied for Medicaid.  
• For gifts (transfers) made ON or AFTER February 8, 2006, the penalty period will start when you apply for Medicaid.  In other words, you can be denied Medicaid coverage exactly when you need the Medicaid coverage.

However, not all gifts or transfers will result in a Medicaid penalty. Some transfers that might not result in a penalty include:

• Giving certain assets to your spouse
• Giving certain assets to an adult blind or disabled child
• Giving your home to your spouse; your child under 21; your adult blind or disabled child; your brother or sister who partly owns or has an interest in the home and has lived there for at least one year before you went into a nursing home
• Giving your home to an adult child who lived with you for two years just before you went to a nursing home and whose care made it possible for you to stay at home instead of moving to a nursing facility
• Gifts or transfers you made entirely for some reason other than getting on Medicaid
• Certain gifts or transfers that would cause undue hardship if penalized, as determined by the government.

Warning:

• Medicaid rules about transferring property are very complicated...
  Before you decide to give away or transfer property or money to anyone, or to establish a trust, check with a lawyer who knows about Medicaid! See our brochure, Your Home and Title 19, for more information on transfers of home property.

• Medicaid Annuities. There is no such thing as an annuity that will guarantee avoidance of Medicaid spend-down rules. In Connecticut, when an individual applies for Medicaid coverage, each annuity is reviewed on a case-by-case basis to determine how it will be used to help pay for his or her care. The Department of Social Service regulations concerning annuities are complicated.  In addition, the DRA recently changed the law regarding annuities.  An attorney should be consulted before buying an annuity or before filing a Medicaid application if an annuity is already owned.

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What happens to my monthly income if I am in a nursing home?

If you are on Medicaid in a nursing home, you will probably have to use your monthly income from Social Security, a pension, etc. to help pay the nursing home bill.

Most likely, your income will not be enough to pay the entire bill, and DSS will pay the rest of the bill and other medical expenses you may have.

However, you do not have to pay ALL your income to the nursing home each month. You may keep:

• $63 a month for personal needs such as clothes, toiletries, sundries, etc.  (This amount is increased each year in July based on increases in the cost of living adjustment).
• An amount to give to your spouse or other dependent who lives at home as a support allowance. (This important point is explained in more detail below.)
• Amounts to pay for medical items that Medicaid doesn't cover. For example, if you lose a new hearing aid that Medicaid has just paid for, Medicaid may not pay for another hearing aid right away. You can use your monthly income to replace the hearing aid instead of paying the nursing home.
• Any single wartime veteran or surviving spouse of a wartime veteran may be entitled to a pension (currently $90 month) in addition to his/her personal needs allowance.
• A limited home maintenance allowance to pay for certain expenses, including rent or mortgage, for up to 6 months, if you are reasonably expected to return home within that period of time.

How much income is my spouse at home allowed to have to meet his or her needs in the community?

The law provides for a minimum amount of total monthly income that a community spouse should have. As of July 1, 2007 this figure is $1,711.25* a month. If a community spouse's monthly shelter costs (such as rent, mortgage, taxes, home owners insurance and utilities) are greater than $513.37*, he or she may be entitled to receive a higher amount of total monthly income.

A community spouse generally will not get more than $2,541.00* a month, including his or her own income, unless he or she asks for a hearing from DSS to claim the need for a higher amount. The community spouse can also go to court to get a higher amount. The community spouse may be able to get a higher amount if there are high shelter costs or exceptional circumstances causing him or her financial difficulties.

*These amounts increase every year.

What happens if my spouse at home does not have enough income to meet his or her needs?

If a community spouse’s own income is less than the total monthly income he or she should have by law, then he or she is entitled to receive a "community spouse allowance" from the nursing home spouse to fill this income gap.  The community spouse allowance is made up of:

(1) the nursing home spouse’s monthly income, and,
(2) only if this income is not sufficient to fill the gap, another source of monthly income.  This other source is the income generated from some or all of one-half of the nursing home spouse’s assets (e.g., interest income) given to the community spouse before spending down to $1600.  In other words, the nursing home spouse gives income first, assets second — and only if necessary — to fund this community spouse allowance.  The community spouse may still be able to keep more than one-half of the total spousal assets despite this "income-first" requirement. (See above for more information about assets.)

You may use the worksheet at the end of this pamphlet to estimate the community spouse allowance. However, you should still consult a lawyer who knows Medicaid law. These rules are very complicated.

If you are the spouse of a nursing home resident on Medicaid, check with a lawyer who knows Medicaid to see if you should be allowed to keep more of your spouse’s monthly income or your assets to meet your needs at home.

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Does my spouse have to pay for my nursing home care from his or her income?

No. If you are in a nursing home and need Medicaid, DSS will look only at your own income to decide if you are eligible and how much you will have to pay each month to the nursing home. The income OF YOUR SPOUSE will NOT BE COUNTED OR ADDED IN.

In certain situations, the state may ask for support from the spouse of a nursing home resident who is on Medicaid. Your spouse at home should never be asked to pay the nursing home out of income he or she has been allowed to keep by DSS or by a Fair Hearing or Court decision.

Any spouse at home who has been asked by DSS to pay a nursing home from his or her income should consult an attorney with knowledge of Medicaid law before agreeing to make any payments.

How do I apply for Medicaid?

To get a Medicaid application, call the Department of Social Services (DSS) at 1-800-842-1508, go to the DSS office nearest you, or visit the DSS web site to find your local office.

What can I do if my Medicaid application is denied for some reason?

You have the right to ask DSS to give you a "Fair Hearing" to challenge the denial of your application for Medicaid. You must ask for this hearing within 60 days from the date of the denial notice.

To ask for a hearing, you can write to:

Connecticut Department of Social Services
Office of Legal Counsel, Regulations and Administrative Hearings
25 Sigourney Street
Hartford, CT 06106-5033
Phone: (860) 424-5760 or 1-800-462-0134

If you are denied Medicaid, you can contact the legal aid office nearest where you live (see below) or Statewide Legal Services at 1-800-453-3320 or 860-344-0380 for information and assistance.

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Community Spouse Allowance Worksheet

If you have a spouse in a nursing home on Medicaid, you may use this worksheet to ESTIMATE your monthly Community Spouse Allowance. Effective July 1, 2007

* Note: These figures are effective July 1, 2007 - June 30, 2008.

Remember, you or your representative must ask DSS for a "Fair Hearing" or go to court to get a higher community spouse allowance to meet your needs.

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For more information

Statewide Legal Services: (860) 344-0380 (Central CT & Middletown) 1-800-453-3320 (All other regions).  Call Statewide Legal Services for your other legal questions.  SLS provides free brochures, pamphlets, and referrals to those who qualify.

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This pamphlet was produced by the Legal Assistance Resource Center of CT in cooperation with Connecticut Legal Services, Greater Hartford Legal Aid, New Haven Legal Assistance Association, and Statewide Legal Services.

The information in this pamphlet is based on laws in CT as of July 2007. We hope that the information is helpful. It is not intended as legal advice for an individual situation. If you need further help and have not done so already, please call Statewide Legal Services (see above) or contact an attorney. Copyright: July 2007.