Facing the possibility of nursing home care often raises a pressing question for couples: will the spouse at home be left with enough to live on? Many couples worry that the healthy spouse will be left with nothing, especially when Medicaid eligibility comes into play. The truth is, both federal and New Jersey laws include protections so that a spouse living at home is not impoverished. Understanding how these rules work can help you plan ahead and protect what you’ve built together.
How Medicaid Looks at Assets for Nursing Home Care
Medicaid is often the only way families can afford long-term nursing home care, since private pay costs can quickly reach thousands of dollars per month. To qualify, the spouse entering the nursing home must meet strict income and asset limits. However, Medicaid treats married couples differently from single applicants.
The law recognizes that the spouse living at home, known as the “community spouse,” still needs resources to cover everyday expenses. That’s why Medicaid allows the community spouse to keep a certain amount of assets, even if the other spouse is applying for benefits.
The Community Spouse Resource Allowance
One of the key protections is called the Community Spouse Resource Allowance (CSRA). This rule lets the healthy spouse keep a portion of the couple’s assets without affecting the nursing home spouse’s eligibility.
In New Jersey, the community spouse is typically allowed to retain:
- A set amount of countable assets, up to a maximum figure set each year by federal law
- The family home, if the community spouse continues living there
- One vehicle, regardless of value, if it is used for transportation
- Personal belongings and household goods
The exact figures change annually, but the principle remains the same: the community spouse should not be left destitute while the other spouse receives care.
What Counts as “Countable” Assets?
Not all assets are treated the same way for Medicaid purposes. Generally, the following are considered countable:
- Checking and savings accounts
- Stocks, bonds, and other investments
- Additional real estate (beyond the primary residence)
- Certain retirement accounts, depending on how they’re structured
Meanwhile, some assets are non-countable, meaning they can usually be retained without affecting Medicaid eligibility. These include the primary residence, one car, household items, and some burial arrangements.
Because the rules are complex, even small differences in how accounts are titled or funds are used can affect eligibility. That’s why families often turn to legal guidance before applying.
Income Protections for the Community Spouse
It’s not just about assets. Income is also treated differently between spouses. The spouse in the nursing home must contribute most of their income toward their care, but the community spouse may be entitled to keep some of that income through what’s called the Monthly Maintenance Needs Allowance (MMNA). This helps cover living expenses like mortgage payments, utilities, and groceries.
Planning Ahead Makes a Difference
The earlier couples plan, the more options they have to protect their resources. Medicaid has a five-year lookback period, meaning transfers or gifts made within five years before applying may cause penalties. With proper planning, couples can:
- Restructure assets to maximize exemptions
- Set aside resources for the community spouse’s future needs
- Explore trusts or other estate planning tools designed for long-term care planning
By being proactive, you can help ensure that both spouses are financially protected, even if nursing home care becomes necessary.
Common Misconceptions
Many families worry that applying for Medicaid means losing everything. That’s not the case. Some common myths include:
- “My spouse will be forced to sell our home.” In most cases, the family home is protected if the community spouse continues to live there.
- “We can’t keep any savings.” The community spouse is allowed to retain a significant amount of assets.
- “It’s too late to plan once one spouse enters care.” Even if nursing home care has already started, strategies may still be available to preserve assets.
How We Can Help
At E.A. Goodman Law, LLC, we understand how stressful it is to think about nursing home costs and Medicaid eligibility. Our team will review your unique situation, explain the rules in plain English, and create a plan that protects both you and your spouse. Whether you’re planning ahead or already facing immediate care needs, we’re here to guide you through the process and safeguard your family’s financial security.
Protecting Your Spouse and Your Assets
If you or your spouse may need nursing home care, it’s natural to worry about how it will affect your finances. The good news is that the law provides important protections for the community spouse. With thoughtful planning and the right legal advice, you can make sure your spouse is not left without resources.
Contact E.A. Goodman Law, LLC today to learn more about how we can help you protect your assets while ensuring your spouse’s well-being.
Posted in: Medicaid Planning