By: Atty. James J. Fiorentini

The purpose of this update is to give you a general outline of Medicaid and answer some very basic questions. This update should not be construed as legal advice.

Medicaid, which in Massachusetts is called "Mass Health" is Federal Government program designed for low and moderate income people to pay their medical bills.

Note that Medicaid is not the same as Medicare. Medicare is for the elderly. Medicaid is for persons of limited economic means.

Medicaid is important because Medicaid is the only government program that will pay for long-term nursing home care.

In order to be eligible for Medicaid, an individual must have less than $2,000 in countable assets. The key is the word countable. Some assets do not count. For example, the house that you live in does not count. If you are temporarily in a nursing home but plan to go back to your home, then the home is not a countable asset. If you should go into a nursing home temporarily, always indicate that you intend to return home.

No. Many transfers would make you ineligible for Medicaid. These are called "disqualifying transfers".

A disqualifying transfer is a transfer made for less than adequate consideration (i.e. a gift or a partial gift) which is made for the purpose of making you eligible for Medicaid.

A. No. Any transfer of assets from a joint account, regardless of who makes the transfer, will be considered a transfer.

A. After you die, the State may put a lien against your home to recover the amount of Medicaid benefits that have been paid over your lifetime. They can not place this lien so long as you or your spouse resides in the home.

A. Yes, absolutely. If you can afford long term care insurance, and meet the eligibility requirements, this is an acceptable way to manage the risk of an extended stay in a nursing home.

A. No. You are required to pay to the nursing home your total monthly income, minus $35.00 for personal needs.

A. No. While you may have lost the opportunity to use some of the easier strategies, it is never too late to protect some if not all of the remaining assets.

In a 1996 case, Kohen v. Commissioner of the Division of Medical Assistance, the Supreme Court of Massachusetts said that the money in a so-called "Medicaid Qualifying Trust" would count for Medicaid eligibility purposes. This would be the case even if the trust specifically limited the trustee's authority and provided that the trustee was not to make distributions that would render the beneficiary ineligible for Medicaid benefits. Basically the Court disregarded those limitations and held that the full amount of the trust has to be counted in determining Medicaid eligibility. The Kohen case is only part of a series of cases where the Courts have made it increasingly difficult for middle and upper income people to obtain Medicaid. For example, in another recent case Massachusetts Supreme Court held that money that a man was required by Court order to pay to support his children would still be counted as money that was available to him for Medicaid eligibility purposes.

In determining eligibility, the Courts first take a "snap-shot" of all of the assets that are available to both husband and wife.

The Medicaid program that distinguishes between the "community spouse", defined by the regulations as a recipient who remains in the community and a "long-term care case" or "institutional spouse". From the couple's total countable assets, the Medicaid division then sets aside an "asset allowance" which the community spouse can use for his own maintenance. At the present time, that asset allowance is one half of the couple's total combined countable assets, provided it does not exceed $76,740 and a minimum of $15,348. It actually defines the asset allowance as follows: