The Federal Government has published the consumer price index for all urban consumers, all items, U.S. city average (the CPI-U) for the month of September 2014. Using these figures it is possible to project Medicaid's 2015 Community Spouse minimum and maximum resource allowance and maximum income allowance for 2015.
What are Community Spouse Resource and Income Allowances?
In general, when your spouse is in a nursing home or needs assistance with home care under a Medicaid Waiver program (like Pennsylvania’s Aging Waiver program) he or she will not qualify for Medicaid benefits until your combined financial resources are reduced to a certain level. That permitted level of so-called “available resources” varies depending on your financial circumstances.
For nursing facility residents, the general rule is that the community spouse can keep ½ of the amount of available resources that were owned by the couple on the date of admission to the nursing facility. However, this standard protected “Community Spouse Resource Allowance” is subject to a ceiling and a floor. The ceiling and floor amounts for 2015 are set out below.
In addition to being allowed to keep the resource allowance, the community spouse is also entitled to have a certain level of income called the Monthly Maintenance Needs Allowance. This income allowance is also subject to a ceiling and a floor. If the community spouse does not have the required level of income, that spouse may be allowed to keep some of the institutional spouse’s income. If the income diverted from the institutionalized spouse is still insufficient, the community spouse may be able to keep additional resources.
What are the Resource and Income Allowances for 2015?
These community spouse resource and income allowances are adjusted annually. Although the new figures have not yet been announced by the Centers for Medicare and Medicaid Services (CMS), by law they are based on the consumer price index for all urban consumers published by the Bureau of Labor Statistics (the CPI-U) for September of the prior year which has now been released.
The Medicaid law established the initial community spouse resource allowance at levels of $12,000 minimum and $60,000 maximum for 1989 based on the CPI-U for September 1988. The initial maximum income allowance was set at $1,500. The law provides that these levels be increased by the same percentage as the percentage increase in the CPI-U between September 1988 and the September before the calendar year involved.
The CPI-U for September 1988 was 119.8. The CPI-U for September 2014 was 238.031. This means that the CPI-U has increased 98.6903% over the period. For calculation purposes, I’ve rounded this percentage to 98.7%.
Because the September CPI-U has now been released, I can now project that effective January 1, 2015, the new standard community spouse allowances should be as follows:
- · Minimum Community Spouse Resource Allowance = $23,844.
- · Maximum Community Spouse Resource Allowance = $119,220.*
- · Maximum Community Spouse Monthly Income Allowance = $2,980.50.
Note: The current Minimum Monthly Income Allowance remains at $1,966.25 – it will be adjusted on July 1, 2015. The income allowances are higher for residents of Hawaii and Alaska.
Readers should understand that the Community Spouse Resource Allowance is a starting point for planning. A community spouse can often protect resources in excess of his or her resource allowance through Medicaid planning techniques such as the purchase of a Medicaid qualified annuity. (Be sure to consult an experienced elder law attorney before purchasing an annuity for purposes of qualification for Medicaid benefits.)
The allowances discussed in this post can be calculated from the September CPI-U. But they have not yet been formally announced by the Centers for Medicare and Medicaid Services (CMS). It is possible that CMS could ultimately announce figures that are slightly different than those above. But my projections have been correct in the past and I have a high degree of confidence in them.
Thanks to my friend and fellow elder law attorney Robert Clofine of York, Pennsylvania, for being first to calculate these 2015 inflation adjusted figures.
Spousal Impoverishment (from Medicaid.Gov website).
The law governing these protected amounts is found at 42 U.S.C. §1396 – 5.
* To illustrate, here is how I did the calculation for the Maximum CSRA:
Round 1.9869 to 3 decimal places = 1.987
1.987 X $60,000 = $119,220 (the new maximum CSRA for 2015)