Recently California made a BIG change in its determination for Medicaid eligibility for long-term care. If you don't know, Medicaid covers long-term care costs for individuals who need long-term care at home or in a facility. In order to be approved for Medicaid, individuals must complete a complex application and meet very strict income and asset limits. In Massachusetts, an individual cannot have more than $2,000 worth of assets to their name - YES you read that right, only $2,000 in total assets. You can read more about eligibility in Massachusetts here.
Each state determines thier own Medicaid rules and system. but Medicaid is a joint state-federal program meaning that federal money covers half of Medicaid costs and the state pays for the other half. While most states follow the same asset limit as Massachusetts of $2,000, California has become the first state to eliminate the asset limit for its residents.
As of July 1, 2022, the asset limit for an unmarried individual who needs to apply for Medicaid will be raised to $130,000. That's a very big difference from $2,000! If the applicant is married, the limit will be raised from $137,400 to $267,000. This means that more individuals, married or single, are now going to be able to apply and be eligible for Medicaid without having to "spend down" all of the money they spent thier whole lives making.
One thing to note about this change however is that estate recovery rules are still going to be intact. That means that people who are on Medicaid and pass away can have thier estates subject to estate recovery by the state if they do not have the proper planning in place. Estate recovery means that federal law requires the state to recover the long-term care benefits from a Medicaid recipient's estate after their passing. This means the state can force a sale of their home in order to settle the claim if it cannot be resolved any other way. This is when estate planning comes into play! Estate recovery happens in Massachusetts all the time. If you want to learn more about how to prevent this from happening to you or a loved one, download our FREE report How to Pay for Long-Term Care or give us a call at 978-657-7437.
While California is currently the only state to make this asset limit change, we hope that this is setting the standard other states will soon follow. For now, we are still dealing with a $2,000 limit in Massachusetts so if you need help qualifying for Medicaid, do not hesitate to reach out to our firm! We have a 100% success rate with Medicaid applications and know all the tricks to get even high-net-worth individuals qualified. You can learn more about the Medicaid application in our FREE report 5 Reasons Your MassHealth Long-Term Care Application will be Denied.
To read more about California removing the asset limit for Medicaid, read this article written by ElderLawAnswers.