On June 10, 2016, Wisconsin’s Department of Health Services updated its Medicaid Eligibility Handbook (called the “MEH” for short, and that is a pretty good description of how it usually makes me feel to read it.) This update changes the policy on what date is to be used for the “snapshot” date for Family Care.
What is a snapshot date anyway? And why should I care?
The snapshot is one of the terms we use in describing the process of applying for Family Care if you are a married couple. The rules that apply are called “spousal impoverishment.” I explained these in an earlier post, but it bears repeating here since it’s been awhile. This is not an easy concept, but I am hoping it will make sense when you read through these steps. At the end, you will see why it is very important to understand how important the snapshot date can be for your future.
An explanation of basic Medicaid “spousal impoverishment” rules.When a couple is married, and one spouse needs nursing home care, or care in the community through Wisconsin’s alternative to nursing home care called “Family Care,” Medicaid will provide coverage of the cost of care if the couple meets financial eligibility rules. These rules are commonly referred to as “spousal impoverishment” rules but actually, that is a misnomer. The current set of rules regarding eligibility for married couples is based on federal law that was put into place by Congress to prevent spouses from becoming impoverished if only one needed nursing home care. Therefore, they really aren’t “spousal impoverishment” rules, they are “spousal anti-impoverishment” rules.
The spouse applying for benefits is called the “institutionalized spouse” – either in a nursing home or applying for Family Care (kind of a misnomer, since the whole point of Family care is to stay out of an institution.) The spouse who is not applying, and lives in the community – is called the “community spouse.” The “institutionalized spouse” could also be referred to as the “nursing home spouse” but today, we are talking about Family Care so I won’t use that term.
Assets: Under these rules, the allowable amount of assets that the couple can have to qualify for Medicaid is between $50,000 and $119,220, plus $2000 for the nursing home spouse. The asset level is called the “community spouse resource allowance.” The exact target number within this range is based on half of the couple’s assets that are calculated as of the “snapshot” date. But the minimum asset level that can be imposed is currently $50,000 and the maximum, absent some special exceptions, is $119,220. Assets in the name of either spouse are counted, even if the spouses have a marital property agreement in place between them. The house is not counted in this total as long as it is worth less than $750,000. A few other things are not counted also, such as retirement funds that belong to the community spouse. Even with some exclusions, these totals are significantly less than what is estimated that a couple should save for a secure retirement.
Income: There are also rules related to income. These rules say that once the nursing home spouse is eligible (based on meeting the asset test described above), he or she may in some cases be able to transfer a certain amount of income every month to the community spouse. This transfer is allowable only in cases where the community spouse has less than $2655-2980.50 in his or her own income per month. In those cases, the nursing home spouse can transfer income, but only enough to bring the community spouse’s total income to that level. The exact amount within this range is based on the amount of expenses for “shelter” that the community spouse incurs. So you take the appropriate income allocation amount, and subtract the community spouse’s income, and the difference is what the institutionalized spouse can transfer.
But today we aren’t here to talk income. Because the snapshot is all about assets.
Snapshot: The snapshot date is extremely important because it is the date that is used to determine the couple’s initial assets for spousal impoverishment purposes. It is this calculation that forms the basis for how much the couple can keep in order to qualify for Medicaid. In other words, if a couple has $120,000 on the snapshot date, their asset level in order to qualify for Medicaid will be $60,000. If a couple has $200,000 on the snapshot date their target level will be $100,000. Because of the rules regarding minimum and maximum, if a couple had $80,000, even though the general formula of “half” would be $40,000, that would be less than the minimum of $50,000 so the target for that couple is $50,000. Similarly, due to the maximum, if a couple has $500,000 their target level will be $119,220 (plus $2000) even though that is far less than half.
This leads to the phrase I repeat to my clients until they “get it”: Half of more is more, half of less is less.
When is the snapshot date? Well, that is what this post and the policy change is all about. The snapshot date is more formally defined as the “first continuous period of institutionalization” which is easy when we are talking nursing home care. In that case, it is the first day that the person went into a medical institution for 30 days or more. This is usually a nursing home, but a hospital can be a medical institution also.
For Family Care, the new policy says that the snapshot date is the date that a person had a functional screen that determined they met the “functional” requirements for Family Care.
Ok, I am sorry, we need to take a little side trip to understand Family Care and then we’ll get back to the snapshot. (Are you beginning to see why people can’t understand Medicaid without the help of a lawyer?) For Family Care, the purpose of the program is to provide long term care and support to people who – without the services – would need to be in a nursing home. In order to figure out whether a person meets this criteria, an evaluation has to be made regarding that person’s needs for help. This evaluation is called the “functional screen.” This screen is typically performed by someone from your local county’s Aging and Disability Resource Center (ADRC). The ADRC person will come to your house or the assisted living facility, ask a bunch of questions and complete the screen using state criteria. I tell people it is not the time to be stoic – you should not downplay your need for help during this screen. If a person “passes” the screen it means they do need assistance with the required number of activities of daily living.
So, according to the new policy, when the person from the ADRC comes out to do that screen, if the spouse “passes” the screen meaning they do need assistance, that is the day that will be used for the snapshot.
Getting back to the concept of “half of more is more, half of less is less” – you will want to make sure all of your ducks are in a row before getting that functional screen, particularly if you are one of the couples whose countable assets are within the range between $100,000 and about $250,000. If you are in this range, you will want to make sure you do not spend money on discretionary big-ticket items before getting the screen. Don’t buy that new car, or put that roof on the house, or prepay for funeral plans until after the screen. Most couples in this case will want to get the screen sooner rather than later, before they spend a lot of assets. It could mean a difference of thousands of dollars in your community spouse resource allowance. An ADRC may request that you disclose finances when you call for the screen, and then may push back or tell you that you have too much money so it doesn’t make sense to get this screen, especially if your assets are high, but you have a right to it and should get it before lots of resources have been spent on your spouse’s care.
Also, there are things you can do proactively to raise the level of your assets in anticipation of that snapshot. You really need to talk to a lawyer to understand all of these options and to be smart about the process.
When you contact the ADRC for information about programs and services, the friendly person may offer to come out and do a functional screen. I suggest you see a lawyer before scheduling that, and recognize that at this point, that screening test has both functional and financial significance.