Applying for Medical Assistance


Any transfers of property, ownership of accounts, stocks, bonds, or CD’s within the past five years, if applying for Medicaid must be reported. (Five years if any trust has been established.)

When completing the Resource Assessment, the assets of the Community Spouse must also be reported, regardless of how they are titled, or where they came from. All resources must be reported as of the day of admission to the nursing home. (Even if the nursing home bills are being paid by the insurance company or private funds at the time). This also applies to any other jointly held accounts listing either spouses’ name or social security numbers. It does not matter if the account is in parent’s name joint with a child – it gets reported.

Transfers between husband and wife are exempt from gifting rules but transfers outside of this result in a period of ineligibility for Medical Assistance unless one of the exceptions apply.

When gifting is being done, be sure to make a copy of the gift check or maintain the receipt for transactions completed and if it involves property or other items, have a documented value of the gift at the time of transfer. (E.G. – Life insurance transfer requires a written statement of cash value at the time of transfer; cars require the blue book value; real property requires the fair market value.)

Note that an asset is always viewed as available until the actual transfer has been completed. When a gift check is written, it must then be deposited and cleared through the bank account before it is considered to be a clear transfer.

Irrevocable burial funds that are purchased after someone enters the nursing home must be paid for prior to the requested effective date for Medical Assistance.

Maintain clear paper trails of all accounts, CD’s, stocks, or bond closures, showing when closed, amount received and where the money went. (E.G. Account that money was deposited into, and what the funds were used for – Nursing Home bill, repairs or burial funds.)

As a general rule – the full value of joint bank accounts and CD’s, etc. are considered belonging to the person in the nursing home.

Keep ALL financial records. (DHS caseworker may ask for records covering entire look back period).

If an IRA is being withdrawn – pay estimated income tax at time of withdrawal.
Note: The IRA of the community spouse will not be touched!

If switching from Medicare Advantage to regular Medicare – be sure to obtain supplemental Health Insurance as well. This is best arranged in coordination with the nursing home in which the resident is applying to, and do not stop paying premiums of health insurance plan until verified with the home’s business office that payments are being handled by them.

Verify that all beneficiaries on life policies, IRA’s, etc. have been changed from the Medicaid recipient’s name. Change of a beneficiary is not a gift.

Direct deposit checks must be rerouted from a bank account prior to that person’s name being removed from the account, for Medical Assistance purposes.

Once Medical Assistance is approved there is an annual review of the recipient’s assets in order to assure that eligibility has been maintained.

With respect to a husband and wife situation, there is also a maximum ninety day allowance from the date of approval, to provide verification of the recipient’s name being removed from any account except the permitted resource limit of $2,000 or $2,400. BUT DON’T WAIT! FAILURE TO CHANGE HUSBAND AND WIFE ACCOUNTS TO SOLE ACCOUNTS CAN LEAD TO PROBLEMS FOR THE INSTITUTIONALIZED SPOUSE. Keep community spouse on Institutionalized Spouse’s account as joint owner so they can access the allowed monthly income for themselves and also to keep asset limit low for Institutionalized spouse.