When one spouse is living in a nursing home and the other spouse is living anywhere else, the spouse who is not living in the nursing home (who is known under MassHealth law as the “community spouse”) is allowed by MassHealth to keep some (or sometimes all) of the nursing home resident’s income through an income allowance known as the Minimum Monthly Maintenance Needs Allowance (MMMNA). Every July 1st, this figure changes based on federal poverty level guidelines. The MMMNA was $1,939 from July 1, 2013 until June 30, 2014, and has been increased to $1,966.25 from July 1, 2014 through June 30, 2015.
If certain basic household expenses are more than 30% of the MMMNA, which amounts to $589.66, the community spouse is entitled to keep extra income, known as the Excess Shelter Amount (“ESA”). Between the MMMNA and the ESA, the community spouse can now be entitled to as keep as much as $2,931.00 of the married couple’s total income. If even more income is needed, such as where the community spouse is living in an assisted living facility, the community spouse can request a fair hearing and attempt to prove the need for more than $2,931.00 of the married couple’s total income. In some cases, the community spouse would need more than $2,931.00 due to the costs of an assisted living facility, but would be required at the fair hearing to prove the need to live there.
Utilizing the MMMNA provisions in Medicaid/MassHealth law is always better than purchasing an immediate annuity, since all payments from the annuity are treated as income, and taking that step ends up reducing the amount of the married couple’s retirement income that the community spouse could otherwise keep. Unfortunately, due to the asset rules under Medicaid/MassHealth, in many situations the community spouse has no choice but to purchase an immediate annuity with excess assets. See Protecting Assets and Maximum Income in 2014 When Applying for MassHealth to Help Pay for the Unhealthy Spouse’s Nursing Home Bills.