Cost of Living Increase Impacts Medicaid Income Eligibility

Cost of Living Increase Impacts Medicaid Income Eligibility

On January 1, 2019, the Social Security Administration adjusted benefits upward by 2.8 percent.  The 2.8 percent cost-of-living adjustment will begin with benefits payable to more than 62 million Social Security beneficiaries.  Increased payments to more than 8 million Supplemental Security Income (SSI) beneficiaries brings the maximum monthly benefit from $750 per month in 2018 to $771 per month in 2019.

For individuals who need nursing home care or long-term care in the community and are seeking Medicaid, this means that the Special Income Limit (SIL) is $2,313 per month.  If an individual’s GROSS income from all sources exceeds $2,313 per month, that individual is ineligible for Medicaid unless they establish a Qualified Income Trust (QIT).  Income in excess of the SIL transferred to the QIT each month is not counted for eligibility purposes, although still taken into account when determining an individual’s monthly share of cost, or patient liability amount.  Even if an individual meets all other Medicaid eligibility requirements, i.e. they meet the level of care, their resources are below $2,000, etc., if their income exceeds the SIL and the QIT is not properly established and administered, an individual will be ineligible for Medicaid.  This relatively new requirement (August 2016) presents unique challenges and considerations, such as whether an agent under a durable power of attorney has the legal authority to create a trust, whether an individual who is incompetent and subject to a Guardianship can get a court order to establish the trust, and who will serve as the Trustee and facilitate the monthly administration of the QIT, especially for individuals without family support or advocates.

Posted in Blog, Disabilities, Estate Planning.