The Centers for Medicare & Medicaid Services (CMS) has released the 2023 federal guidelines for how much money the spouses of institutionalized Medicaid recipients may keep, as well as related Medicaid figures.
What Are Spousal Impoverishment Rules?
Spousal impoverishment is a concern for older couples when there is one spouse who requires long-term care and applies for Medicaid.
Before the federal government enacted spousal impoverishment protections, many healthy spouses faced poverty when their partners needed long-term care. The spousal impoverishment rules are based on the idea that spouses will provide for each other.
Community Spouse Resource Allowance
In 2023, the spouse of a Medicaid recipient living in a nursing home (called the “community spouse”) may keep as much as $148,620 (in most states) without jeopardizing the Medicaid eligibility of the spouse who is receiving long-term care.
Known as the community spouse resource allowance (CSRA), this is the most that a state may allow a community spouse to retain without a hearing or a court order. NOTE: Since 2012, the CSRA in Illinois has been frozen at $109,560. As noted in the legal update above, Illinois Public Act 102-1037, which took effect on January 1, 2023, includes long-overdue increases to the Illinois CSRA and further provides for it to ultimately realign with the federal maximum CSRA. Pursuant to the new Illinois law, in 2023, Illinois community spouses should be entitled to a CSRA of $120,780. For additional information and details regarding the new Illinois law and the changes to the Illinois CSRA, please see the legal update at the beginning of this month's newsletter.
Maintenance Needs Allowance
Meanwhile, the maximum monthly maintenance needs allowance (MMMNA) for 2023 will be $3,715.50. This is the most in monthly income that a community spouse is allowed to have if their own income is not enough to live on and they must take some or all of the institutionalized spouse's income. NOTE: In Illinois, Public Act 102-1037 also impacted the maximum monthly maintenance needs allowance for Illinois community spouse's. As of January 1, 2023, the monthly maintenance needs allowance in Illinois is finally realigned with the federal maximum. Again, for additional information and details, please see the legal update at the beginning of this newsletter.
The minimum monthly maintenance needs allowance for the lower 48 states will be $2,288.75 ($2,861.25 for Alaska and $2,632.50 for Hawaii) until July 1, 2023.
In determining how much income a particular community spouse is allowed to retain, states must abide by this upper and lower range. Bear in mind that these figures apply only if the community spouse needs to take income from the institutionalized spouse.
According to Medicaid law, the community spouse may keep all their own income, even if it exceeds the maximum monthly maintenance needs allowance. However, community spouses with incomes in excess of the maximum monthly allowance may be required to make a monthly support payment -- to be applied to the monthly cost of care for the institutionalized spouse.
The new spousal impoverishment numbers (except for the minimum monthly maintenance needs allowance) take effect on January 1, 2023.
Home Equity Limits
In 2023, a Medicaid applicant’s principal residence will not be counted as an asset by Medicaid if the applicant's equity interest in the home is less than $688,000. States have the option of raising this limit to $1,033,000.