Spousal Impoverishment

Spousal Impoverishment A. Federal law requires special treatment of income and resources for legally married couples when one (1) spouse remains in the community and the other spouse is institutionalized, referred to as spousal impoverishment rules. B. Spousal impoverishment rules are designed to ensure that the spouse in the community is able to maintain a certain level of financial security so that the community spouse does not become impoverished in order to secure Medicaid eligibility for the institutionalized spouse. C. For spousal impoverishment purposes: 1. An Institutionalized Spouse (IS) resides in a nursing facility, acute care hospital or participates in a Home and Community-Based Services (HCBS) waiver program. 2. The Community Spouse (CS) resides in a community setting such as a home, residential care facility or assisted living facility. A CS may also be a participant in a HCBS waiver program, but only for post-eligibility income allocation purposes from an IS in a facility. 3. A family member may be a minor or dependent child, a dependent parent and/or a dependent sibling of the parent who resides with the CS. D. At the initial eligibility determination, countable resources belonging to both the IS and the CS, whether owned individually or jointly with each other or their proportionate share of resources owned with other people, are combined. 1. The CS share of combined countable resources is equal to the federal resource maximum, subject to annual adjustments. 2. The IS share of countable resources is equal to the institutional resource limit for an individual plus the value of any resource(s) that exceeds the CS federal maximum as of the month of institutionalization. The IS cannot qualify for Medicaid until the excess resources are depleted. 3. The IS can transfer resources to the CS to bring the CS spousal share up to the federal maximum provided the necessary transfers are accomplished with ninety (90) days after the CS is informed in writing of the need to transfer spousal resources. a) For long term hospitalization applicants that end after the required thirty (30) consecutive day admission, the spousal share must be transferred to the CS before eligibility can be determined. b) For allowable admissions to nursing facilities that end prior to the thirty (30) consecutive days, the spousal share must be transferred to the CS before eligibility can be approved. c) The exception for requiring resources to be transferred to the CS is the death of the IS during the ninety (90) day protected period for transferring spousal resources. d) Home property located out of state must be transferred to the CS unless the property can be excluded under another provision. Failure to transfer non-excludable out of state home property to the CS will result in residency issues for the IS. 4. Excluded income producing resources may be transferred to the CS without any impact on the CS resource maximum. Non-excluded income producing resources may be transferred in order to maximize income available to the CS if the spousal share allows. To receive a spousal share that is greater than the federal maximum, a court order is required granting the CS a larger share of spousal resources. E. The following rules apply to ownership of income by an IS and a CS unless evidence to the contrary is presented. 1. Income paid to one (1) spouse is income of that spouse. 2. One-half (0.5) of income paid to both spouses is available to each member of the couple. 3. Each spouse’s proportionate share of income is counted toward each spouse. If individual interests are not specified, one-half (0.5) is available to each spouse. 4. If there is no instrument establishing ownership, one-half (1/2) of any income is available to each member of the couple. 5. Income paid from a trust is evaluated using the terms of the trust against applicable trust policy. 6. A CS income allocation from income of the IS counts as income to the CS in determining Medicaid eligibility of the CS, as outlined in Miss. Admin. Code, Title 23, Part 105, Chapter 8. F. An assessment or snapshot of spousal resources may be provided upon request if an IS has entered a nursing facility but is not yet applying for Medicaid. The assessment provides an evaluation of spousal resources, i.e., how Medicaid would treat spousal resources if an application was filed. G. Married couples who are separated but not divorced at the time the IS enters long term care are subject to spousal impoverishment rules. The CS must provide resource and income information unless the CS receives SSI or Medicaid in an at-home category of eligibility and income/resource information is readily available. Spousal rules will apply unless undue hardship is determined to exist. H. Spousal rules no longer apply in the month following the death of the IS or CS, a divorce, the IS is discharged from long term care or the CS enters long term care. If the CS is eligible and participates in a HCBS waiver, spousal rules continue to apply if the IS is discharged from the nursing facility. Both spouses cannot be eligible in a HCBS waiver using spousal impoverishment rules. Both must be evaluated separately as individuals using institutional rules.