Are There Asset Limits For The Medicaid Program?
There are many different eligibility factors that need consideration when applying for Medicaid. Among other stipulations, the Medicaid program has set strict asset limitations in order for an applicant to qualify. The asset limits differ depending on whether the applicant is single or married.
Medicaid Asset Limits for an Unmarried Applicant
A single individual applying for Medicaid is allowed $2,000 in non-exempt assets. Non-exempt assets include mostly cash and savings.
Medicaid Asset Limits for a Married Couple
A married couple applying for Medicaid is allowed $3,000 in non-exempt assets.
Exempt assets are assets that Medicaid is not allowed to consider when determining an applicant’s eligibility. These assets have absolutely no limitation, as legally, Medicaid cannot look at them. Some exempt assets include the applicant’s home, automobile (although this is sometimes limited to a fair-market resale value depending on applicant’s state of residence), personal property and items owned by applicant that are for regular everyday use, engagement or wedding rings, life insurance with a cash value of no more than $1,500, term life insurance with no cash value, funeral/burial funds of no more than $1,500 and burial plots.
Transfer of Assets
In order to qualify for Medicaid, some people choose to give away their non-exempt assets. This is referred to as transfer of assets. Be careful in doing this though, the federal government has placed strict penalties on this practice. One cannot simply give all of their assets to friends or family members and then apply for Medicaid the next day. The penalty actually imposes a stated time period during which the individual is not able to qualify for Medicaid following a transfer of assets. The method for determining when one will be eligible for Medicaid is to divide the worth of the assets being transferred by the state of residence’s average cost of healthcare. For example, if a state has determined average cost of care to be $10,000 and an applicant gives away a house that is worth $100,000, then they cannot apply for Medicaid for 10 months.
- When Do I file for Medicaid to avoid penalties for look back rules?
- Are There Routine Spend Down Items Under Medicaid?
- What Are the Income Limits and Resource Levels for Medicaid?
- Does Medicaid Planning Affect My Tax Liablity?
- Can Medicaid Coverage Be Retroactive?
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