What Illinois Residents Should Know About Medicaid

The following information is being provided based on information from Krause Financial Services. They specialize in accelerating eligibility for Medicaid benefits through the use of insurance products, namely, Medicaid Compliant Annuities.

Medicaid is a program jointly funded by state and federal governments intended for people with low incomes and limited resources. Medicaid pays for the majority (over 60%) of long-term care services in the United States. The federal government dictates the rules, and states administer their programs locally through applications and eligibility requirements. Individuals must meet specific criteria to qualify for Medicaid services, which include custodial care.

The following statistics are applicable to Illinois:

Asset Regulations

An Individual Resource Allowance is the amount of assets that a Medicaid applicant can retain and still qualify for benefits. It allows an institutionalized individual to still have access to a small amount of funds for discretionary spending.  In Illinois this allowance is $2,000.

Resource Allowance for a Couple is $3,000 (both partners reside in a facility).

The Divestment Penalty Divisor is the figure used to determine the length of a penalty period if an uncompensated transfer has been made within the lookback period.* It is representative of a state’s average private-pay rate at a skilled nursing facility. This figure varies from state to state. Some states may use multiple divisors.

*The Lookback Period is the 5-year period in which a state’s Medicaid agency will “look back” to determine if a Medicaid applicant has made an uncompensated transfer of assets. If the individual and/or spouse has made any uncompensated transfers, and the transfers are not cured/returned, the applicant will be subject to a penalty period of ineligibility.

**The Community Spouse is the spouse who remains at home or in an assisted living facility and will not receive Medicaid benefits.

Income Regulations

The Personal Needs Allowance (PNA) is the monthly sum of money ($30 in Illinois) that residents who receive Medicaid may retain from their personal income.

Monthly Maintenance Needs Allowance (MMNA)

The Monthly Maintenance Needs Allowance (MMNA) is the amount of monthly income to which a community spouse is entitled. If the community spouse’s income does not meet his or her MMNA, he or she is entitled to a shifting of income from the institutionalized spouse. This figure varies from state to state.  In Illinois, the Monthly Maintenance Needs Allowance is $2,739.

• Minimum/Maximum States – In most states, there is a minimum and maximum MMNA. The community spouse is entitled to at least the minimum. The MMNA may be increased depending upon the community spouse’s monthly shelter expenses, not to exceed the maximum.

• Other States – In states that do not apply the minimum and maximum MMNA regulations, the community spouse is entitled to the standardized figure regardless of his or her shelter expenses.

Community Spouse Resource Allowance (CSRA)

The Community Spouse Resource Allowance (CSRA) is the amount of countable assets to which a community spouse is entitled to retain when qualifying the institutionalized spouse for Medicaid benefits. (The Institutionalized Spouse is the spouse who is in a nursing home (or other Medicaid-approved facility) and is seeking Medicaid benefits.) Excess assets beyond the CSRA must be spent-down before eligibility is achieved. This figure varies from state to state.  In Illinois this allowance is $109,560.

• Minimum/Maximum States – In most states, there is a minimum and maximum CSRA. The community spouse is entitled to one-half of the countable assets as of the “snapshot date*,” not to exceed the maximum and not to fall below the minimum.

• Other States – In states that do not apply the minimum and maximum CSRA regulations, the community spouse is entitled to the standardized amount regardless of the couple’s assets as of the “snapshot date”.

*The Snapshot Date is the date used by the State Medicaid agency to take a “snapshot” of a couple’s finances to determine eligibility. In states that impose a minimum and maximum Community Spouse Resource Allowance (CSRA), the snapshot date determines the couple’s protected amount. Under federal law, the snapshot date is the first day of continuous institutionalization.

If you have questions about Medicaid or need help with your planning needs, we would be happy to assist. Please contact us or request a consultation to learn more.