When a single person is approved for Medicaid benefits, they are required to pay a share of their cost for the nursing home. This is called a patient pay amount (PPA) and it is based upon the person’s gross income (i.e. pension and Social Security Income) minus a limited number of allowances. These include a personal needs allowance of $60.00, health insurance premium allowance, a $60.00 guardianship/conservatorship expense allowance and in rare cases, family and children allowances. Unfortunately, there is no offset for home related expenses such as property taxes or utilities. Typically, the PPA is calculated as follows:
Social Security income: $1000.00
Pension income: + $500.00
Personal needs allowance: – $60.00
Medicare supplement: – $110.00
Patient Pay Amount = $1330.00
A policy exception has however been created to allow a nursing home resident’s income to be diverted for the maintenance of their home for up to six months provided certain conditions are met:
1. The Medicaid director approves the exception.
2. A physician certifies the person is medically likely to return home within 6 months.
3. The request is made for an individual who is Medicaid eligible and residing in a nursing facility.
4. The home is not occupied by a community spouse.
5. The person has a legal obligation to pay housing expenses and provides verification.
6. The request is made by the nursing home resident or an authorized individual.
Here is how the rule works. Suppose a widow named Anne Price falls and suffers a fractured hip. Following surgery, Ms. Price is transferred to a nursing home for rehabilitation. Due to complications from surgery, her recovery is slower than expected and after her 100 days of skilled care coverage has ended, she is not yet ready to return home. Due to her limited assets, Ms. Price applies for Medicaid benefits and is approved. Previously, all but $60.00 of her Social Security income would be paid to the nursing home as her PPA. Absent financial support from her family or other loved ones, she would then be unable to pay her property taxes, homeowner’s insurance or utilities. Thankfully now, once the above conditions are met, Ms. Price’s income can be diverted for up to 6 months to pay for her home related expenses until she is well enough to return home.
The Medicaid rules are very challenging and occasionally provide some hidden benefits. When a loved one is in need of nursing home care, please be sure to consult with an experienced elder law attorney.