When a nursing home resident is receiving Medicaid long-term care benefits, most of their income must be paid to the nursing home each month and applied to the cost of their care. This is sometimes referred to as the resident’s “patient pay liability.”
But, if the nursing home resident is married, this patient pay liability may be impacted by community spouse income protections found in federal and state law.
The non-institutionalized “community spouse” is entitled to retain a certain minimum level of income called the Monthly Maintenance Needs Allowance (MMNA). If the community spouse’s own income is insufficient to provide this allowance, income can be diverted to the community spouse from the institutionalized spouse.
The MMNA is set at 150% of the federal poverty level for a family of two plus an excess shelter allowance, if applicable. The Pennsylvania MMNA is adjusted on July 1st of each year to keep up with inflation adjustments to the poverty level.
In January 2016 the Department of Health and Human Services announced that the 2016 federal poverty guideline for a family of two is $16,020. (It’s higher if you live in Hawaii or Alaska). This means that effective July 1, 2016 Pennsylvania is required to increase the community spouse minimum MMNA to $2,002.50 per month ($24,030/12=$2,002.50). See, 2016 SSI and Spousal Impoverishment Standards.
Pennsylvania usually “rounds up” amounts under one dollar which makes the allowance $2,003 per month. This figure has been confirmed by PA Department of Human Services in Policy Clarification PMN-18024-468.
A standard monthly shelter allowance is built into the minimum MMNA. The actual MMNA allowance can be higher than the minimum if the community spouse has high housing cost and is entitled to an “excess shelter allowance.”
The MMNA can also be increased in situations where the community spouse can show “exceptional circumstances resulting in significant financial duress.” 42 U.S.C. § 1396r-5(d)(2)(B). Several Pennsylvania appellate court cases have dealt with the issue of whether a community spouse has such exceptional circumstances. See Davis v. DPW (776 A.2nd 1026 (Pa.Cmwlth. 2001) and Kuznick v. DPW (5A.3d 832) (Pa.Cmwlth. 2010).
The MMNA can also be increased by judicial court-ordered support under 42 U.S.C. § 1396r-5(d)(5). An increase in the MMNA via judicial order does not require a showing of “exceptional circumstances resulting in significant financial duress.”
The minimum income allowance rules are part of the federally mandated “spousal impoverishment” protections that were enacted in 1988 to limit the potential for impoverishment of spouses of nursing home residents.
Understanding the spousal protections is critical to preserving your financial security if your husband or wife needs expensive long term care. It may be necessary to combine the spousal protections with other planning options to achieve the best results. Contact an experienced elder law attorney for assistance. If you reside in Pennsylvania, you can contact Marshall, Parker and Weber (1-800-401-4552) for more information.