I can’t seem to get a clear answer on this. My husband and I live in a rental apartment and live entirely on his pension and our respective small social security payments here in New York. We own nothing. Right now my husband has early Alzheimer’s and I am trying to plan for the future. We have wills, powers of attorney, health care proxies and Long Term Health Care Insurance which seems to be a pretty good (expensive) policy. In the likely event that he needs assisted living, memory care or nursing home care in the future, the policy will pay a certain amount which may or may not cover the costs of care. If the cost exceeds what the long term health care provides, is it possible that Medicaid could pick up the difference or will his entire pension, social security and IRA have to pick up the difference? He has a small IRA which I read Medicare does not consider an asset but thus far has been used to pay for our Long Term Health Care premiums. It could be used to cover the additional cost of his care but would not last over a year. If the facility took the pension and social security, it would leave me with nothing but a small social security allowance to live on. Even if I was allowed, by Medicaid, to keep half the pension, about $2000,(spousal impoverishment regulation), along with my own Social Security ($700), it would not cover my simple expenses here in NY. (Rent, Gas and electric, phone, Health insurance, Life insurance, my Long Term Care insurance, food, insurance for a car,) Furthermore, it is confusing how much money a “community spouse” is allowed to have in NY for the ill spouse to qualify for Medicaid. In some places I read the spouse is only allowed to have $17,000 a year and in others it is as much as $100,000 ( more than we have now together anyway). I think I would need at least $45,000 a year to live which may exceed what Medicaid allows the community spouse. As you can see, I am very confused and would appreciate any information anyone can provide.
One NYS provision that is little talked about is called "spousal refusal". You might want to read up on that.
Since you have wills etc. can you go back to the lawyer who set that up to help you with the Medicaid process if you are finding it too difficult to understand. The LTC policy may have to be used up before you seek Medicaid but that is why you purchased the policy to begin with. I know of situations where the policy holder passed on before utilizing the policy which only benefits the insurance company. Since you have been paying premiums they might as well be used if needed. The company should pay any amount. There just will be less of a time period of payments depending on the cost of the facility chosen. If you have to pay a lawyer to help you with your questions regarding Medicaid it might be worth it if that lawyer or firm specializes in elder care issues. I think also where you live in NY plays into what funds you need monthly to manage your cost of living. Hope you find the answers you need.
As to your basic questions, Medicaid does not figure in all of this until the assets of the senior are all but GONE no matter where they come from. They may hold their home until after death when there will be some "clawback" on any sale of that home, but they will not keep pensions, IRAs, benefits from LTC, or savings. That is why that division of assets is so crucial. This is something handled best by knowledgable attorneys or financial managers, because mistakes cannot be made in these matters.
For some seniors LTC does not work well and this depends upon their OTHER assets and the policy itself. The insurance when it comes time for it to kick in and pay is an asset. Therefore the senior doesn't spend down, say, savings and become without any assets at all (other than home) and unable to pay, therefore qualifying for Medicaid.
It is all so complicated really, and an area for experts to weigh in on who understand you, your total assets, and what is the best way to move forward. What you "think you need" in terms of money and what the government will allow you to have are two different things, unfortunately.
You might want to see a good elder care attorney today to discuss what you can know NOW, and what you can plan for. This is a good investment in what your future may look like and what you can do NOW to best protect you.