Your Money and Medicaid

I often hear clients say, “I don’t want the State to take all my money.” As a point of fact, the State does not take your money, they simply require you to pay for your care until you qualify for them to pay for this care. This is called spending down your assets. Rest assured however, that there are means to protect your hard-earned assets for your spouse and your family if you follow their rules.

Many people do not want Medicaid because they do not want to be told what to do with their assets. This is understandable, but think of it this way. If you want government money to pay for your care either at home or in a nursing home, why should the State pay for your care if you have the means to pay yourself. How does that make CT taxpayers feel? And yet, the government has a policy that allows you to protect your money and qualify for Medicaid. So

while they are “telling you what to do,” such as saying give money to your spouse, or a trust, or an annuity, by doing as they say you can qualify for their programs and get the care that you need

paid for by the State. That’s not such a bad deal, especially when the cost of a live-in caregiver is around $10,000.00 a month and they can cover it in full!

Another common assumption is that the spouses have to spenddown the money in the sick spouses’ name, and perhaps half the co-owned assets, but nothing more. They believe that since the healthy spouse has always had this IRA or that checking account in their name only, it does not count. Not true! The government does not distinguish between the assets of each

spouse. If you are married all assets count. What is his is hers, and vice versa. But this tie between spouses is a useful bridge. The sick spouse can transfer anything they have to the other, at any time. The healthy spouse can then rearrange the money and keep it all! Not a bad workout.

Attorney Halley C. Allaire is principal in the law firm of Allaire Elder Law, a member of the National Academy of Elder Law Attorneys, Inc., with an office at 271 Farmington Avenue, Bristol, (860) 259-1500, or on the web at www.allaireelderlaw.com. If you have a question, send a note to Attorney Halley C. Allaire and your question may be discussed in a future column.